Correlation Between Cosmos Technology and K One
Can any of the company-specific risk be diversified away by investing in both Cosmos Technology and K One 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 Cosmos Technology and K One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cosmos Technology International and K One Technology Bhd, you can compare the effects of market volatilities on Cosmos Technology and K One 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 Cosmos Technology with a short position of K One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosmos Technology and K One.
Diversification Opportunities for Cosmos Technology and K One
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cosmos and 0111 is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Cosmos Technology Internationa and K One Technology Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K One Technology and Cosmos Technology 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 Cosmos Technology International are associated (or correlated) with K One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K One Technology has no effect on the direction of Cosmos Technology i.e., Cosmos Technology and K One go up and down completely randomly.
Pair Corralation between Cosmos Technology and K One
Assuming the 90 days trading horizon Cosmos Technology International is expected to generate 0.6 times more return on investment than K One. However, Cosmos Technology International is 1.66 times less risky than K One. It trades about -0.21 of its potential returns per unit of risk. K One Technology Bhd is currently generating about -0.36 per unit of risk. If you would invest 43.00 in Cosmos Technology International on November 4, 2024 and sell it today you would lose (4.00) from holding Cosmos Technology International or give up 9.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cosmos Technology Internationa vs. K One Technology Bhd
Performance |
| Timeline |
| Cosmos Technology |
| K One Technology |
Cosmos Technology and K One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cosmos Technology and K One
The main advantage of trading using opposite Cosmos Technology and K One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cosmos Technology position performs unexpectedly, K One 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 K One will offset losses from the drop in K One's long position.| Cosmos Technology vs. Farm Price Holdings | Cosmos Technology vs. Uchi Technologies Bhd | Cosmos Technology vs. ES Ceramics Technology | Cosmos Technology vs. Rubberex M |
| K One vs. Sungei Bagan Rubber | K One vs. IHH Healthcare Bhd | K One vs. Sports Toto Berhad | K One vs. Datasonic Group Bhd |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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