Correlation Between ENVVENO MEDICAL and GigaMedia

Can any of the company-specific risk be diversified away by investing in both ENVVENO MEDICAL 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 ENVVENO MEDICAL and GigaMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ENVVENO MEDICAL DL 00001 and GigaMedia, you can compare the effects of market volatilities on ENVVENO MEDICAL 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 ENVVENO MEDICAL with a short position of GigaMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENVVENO MEDICAL and GigaMedia.

Diversification Opportunities for ENVVENO MEDICAL and GigaMedia

0.15

Correlation Coefficient

ENVVENO MEDICAL  GigaMedia

Average diversification

The 3 months correlation between ENVVENO and GigaMedia is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding ENVVENO MEDICAL DL 00001 and GigaMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaMedia and ENVVENO MEDICAL 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 ENVVENO MEDICAL DL 00001 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 ENVVENO MEDICAL i.e., ENVVENO MEDICAL and GigaMedia go up and down completely randomly.

Pair Corralation between ENVVENO MEDICAL and GigaMedia

Assuming the 90 days horizon ENVVENO MEDICAL is expected to generate 1.6 times less return on investment than GigaMedia. In addition to that, ENVVENO MEDICAL is 2.97 times more volatile than GigaMedia. It trades about 0.01 of its total potential returns per unit of risk. GigaMedia is currently generating about 0.04 per unit of volatility. If you would invest  121.00  in GigaMedia on October 11, 2024 and sell it today you would earn a total of  36.00  from holding GigaMedia or generate 29.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ENVVENO MEDICAL DL 00001  vs.  GigaMedia

ENVVENO MEDICAL DL

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ENVVENO MEDICAL DL 00001 are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, ENVVENO MEDICAL reported solid returns over the last few months and may actually be approaching a breakup point.

GigaMedia

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in GigaMedia are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, GigaMedia unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ENVVENO MEDICAL and GigaMedia

The main advantage of trading using opposite ENVVENO MEDICAL and GigaMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ENVVENO MEDICAL 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.

The idea behind ENVVENO MEDICAL DL 00001 and GigaMedia pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.