Correlation Between MICRONIC MYDATA and GigaMedia
Can any of the company-specific risk be diversified away by investing in both MICRONIC MYDATA and GigaMedia at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining MICRONIC MYDATA and GigaMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MICRONIC MYDATA and GigaMedia, you can compare the effects of market volatilities on MICRONIC MYDATA and GigaMedia and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in MICRONIC MYDATA with a short position of GigaMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of MICRONIC MYDATA and GigaMedia.
Diversification Opportunities for MICRONIC MYDATA and GigaMedia
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between MICRONIC and GigaMedia is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding MICRONIC MYDATA and GigaMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaMedia and MICRONIC MYDATA is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on MICRONIC MYDATA are associated (or correlated) with GigaMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GigaMedia has no effect on the direction of MICRONIC MYDATA i.e., MICRONIC MYDATA and GigaMedia go up and down completely randomly.
Pair Corralation between MICRONIC MYDATA and GigaMedia
Assuming the 90 days trading horizon MICRONIC MYDATA is expected to generate 3.12 times more return on investment than GigaMedia. However, MICRONIC MYDATA is 3.12 times more volatile than GigaMedia. It trades about -0.01 of its potential returns per unit of risk. GigaMedia is currently generating about -0.05 per unit of risk. If you would invest 3,618 in MICRONIC MYDATA on September 13, 2024 and sell it today you would lose (28.00) from holding MICRONIC MYDATA or give up 0.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
MICRONIC MYDATA vs. GigaMedia
Performance |
| Timeline |
| MICRONIC MYDATA |
| GigaMedia |
MICRONIC MYDATA and GigaMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MICRONIC MYDATA and GigaMedia
The main advantage of trading using opposite MICRONIC MYDATA and GigaMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MICRONIC MYDATA position performs unexpectedly, GigaMedia can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in GigaMedia will offset losses from the drop in GigaMedia's long position.| MICRONIC MYDATA vs. PPHE HOTEL GROUP | MICRONIC MYDATA vs. Hyatt Hotels | MICRONIC MYDATA vs. PT Global Mediacom | MICRONIC MYDATA vs. Park Hotels Resorts |
| GigaMedia vs. AOYAMA TRADING | GigaMedia vs. REGAL ASIAN INVESTMENTS | GigaMedia vs. AM EAGLE OUTFITTERS | GigaMedia vs. HK Electric Investments |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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