Correlation Between Cosmos Technology and Uchi Technologies
Can any of the company-specific risk be diversified away by investing in both Cosmos Technology and Uchi 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 Cosmos Technology and Uchi Technologies 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 Uchi Technologies Bhd, you can compare the effects of market volatilities on Cosmos Technology and Uchi 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 Cosmos Technology with a short position of Uchi Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosmos Technology and Uchi Technologies.
Diversification Opportunities for Cosmos Technology and Uchi Technologies
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cosmos and Uchi is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Cosmos Technology Internationa and Uchi Technologies Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uchi Technologies Bhd 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 Uchi Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uchi Technologies Bhd has no effect on the direction of Cosmos Technology i.e., Cosmos Technology and Uchi Technologies go up and down completely randomly.
Pair Corralation between Cosmos Technology and Uchi Technologies
Assuming the 90 days trading horizon Cosmos Technology International is expected to generate 2.2 times more return on investment than Uchi Technologies. However, Cosmos Technology is 2.2 times more volatile than Uchi Technologies Bhd. It trades about 0.05 of its potential returns per unit of risk. Uchi Technologies Bhd is currently generating about 0.06 per unit of risk. If you would invest 35.00 in Cosmos Technology International on November 3, 2024 and sell it today you would earn a total of 4.00 from holding Cosmos Technology International or generate 11.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cosmos Technology Internationa vs. Uchi Technologies Bhd
Performance |
| Timeline |
| Cosmos Technology |
| Uchi Technologies Bhd |
Cosmos Technology and Uchi Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cosmos Technology and Uchi Technologies
The main advantage of trading using opposite Cosmos Technology and Uchi Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cosmos Technology position performs unexpectedly, Uchi 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 Uchi Technologies will offset losses from the drop in Uchi Technologies' long position.| Cosmos Technology vs. ES Ceramics Technology | Cosmos Technology vs. TAS Offshore Bhd | Cosmos Technology vs. Awanbiru Technology Bhd | Cosmos Technology vs. Greatech Technology Bhd |
| Uchi Technologies vs. Oriental Food Industries | Uchi Technologies vs. Malaysia Steel Works | Uchi Technologies vs. Alliance Financial Group | Uchi Technologies vs. Media Prima 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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