Correlation Between PM Capital and AiMedia Technologies
Can any of the company-specific risk be diversified away by investing in both PM Capital and AiMedia Technologies 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 PM Capital and AiMedia Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PM Capital Global and AiMedia Technologies, you can compare the effects of market volatilities on PM Capital and AiMedia Technologies 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 PM Capital with a short position of AiMedia Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of PM Capital and AiMedia Technologies.
Diversification Opportunities for PM Capital and AiMedia Technologies
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PGF and AiMedia is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding PM Capital Global and AiMedia Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AiMedia Technologies and PM Capital 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 PM Capital Global are associated (or correlated) with AiMedia Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AiMedia Technologies has no effect on the direction of PM Capital i.e., PM Capital and AiMedia Technologies go up and down completely randomly.
Pair Corralation between PM Capital and AiMedia Technologies
Assuming the 90 days trading horizon PM Capital Global is expected to generate 0.21 times more return on investment than AiMedia Technologies. However, PM Capital Global is 4.81 times less risky than AiMedia Technologies. It trades about 0.08 of its potential returns per unit of risk. AiMedia Technologies is currently generating about 0.01 per unit of risk. If you would invest 226.00 in PM Capital Global on September 5, 2024 and sell it today you would earn a total of 4.00 from holding PM Capital Global or generate 1.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PM Capital Global vs. AiMedia Technologies
Performance |
| Timeline |
| PM Capital Global |
| AiMedia Technologies |
PM Capital and AiMedia Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PM Capital and AiMedia Technologies
The main advantage of trading using opposite PM Capital and AiMedia Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PM Capital position performs unexpectedly, AiMedia Technologies 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 AiMedia Technologies will offset losses from the drop in AiMedia Technologies' long position.| PM Capital vs. AiMedia Technologies | PM Capital vs. Pinnacle Investment Management | PM Capital vs. Auctus Alternative Investments | PM Capital vs. Regal Investment |
| AiMedia Technologies vs. Pengana Private Equity | AiMedia Technologies vs. PM Capital Global | AiMedia Technologies vs. Wam Leaders | AiMedia Technologies vs. Staude Capital Global |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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