Correlation Between HIM International and C Media
Can any of the company-specific risk be diversified away by investing in both HIM International and C Media 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 HIM International and C Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HIM International Music and C Media Electronics, you can compare the effects of market volatilities on HIM International and C Media 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 HIM International with a short position of C Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of HIM International and C Media.
Diversification Opportunities for HIM International and C Media
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HIM and 6237 is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding HIM International Music and C Media Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C Media Electronics and HIM International 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 HIM International Music are associated (or correlated) with C Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C Media Electronics has no effect on the direction of HIM International i.e., HIM International and C Media go up and down completely randomly.
Pair Corralation between HIM International and C Media
Assuming the 90 days trading horizon HIM International Music is expected to generate 0.28 times more return on investment than C Media. However, HIM International Music is 3.59 times less risky than C Media. It trades about -0.05 of its potential returns per unit of risk. C Media Electronics is currently generating about -0.08 per unit of risk. If you would invest 11,600 in HIM International Music on December 28, 2024 and sell it today you would lose (300.00) from holding HIM International Music or give up 2.59% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.21% |
Values | Daily Returns |
HIM International Music vs. C Media Electronics
Performance |
Timeline |
HIM International Music |
C Media Electronics |
HIM International and C Media Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with HIM International and C Media
The main advantage of trading using opposite HIM International and C Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HIM International position performs unexpectedly, C Media 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 C Media will offset losses from the drop in C Media's long position.HIM International vs. Da Cin Construction Co | HIM International vs. Kindom Construction Corp | HIM International vs. Chien Kuo Construction | HIM International vs. Standard Foods Corp |
C Media vs. Oceanic Beverages Co | C Media vs. United Microelectronics | C Media vs. Standard Foods Corp | C Media vs. Top Union Electronics |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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