Correlation Between Cosmos Technology and LPI Capital
Can any of the company-specific risk be diversified away by investing in both Cosmos Technology and LPI Capital 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 LPI Capital 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 LPI Capital Bhd, you can compare the effects of market volatilities on Cosmos Technology and LPI Capital 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 LPI Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosmos Technology and LPI Capital.
Diversification Opportunities for Cosmos Technology and LPI Capital
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cosmos and LPI is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Cosmos Technology Internationa and LPI Capital Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LPI Capital 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 LPI Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LPI Capital Bhd has no effect on the direction of Cosmos Technology i.e., Cosmos Technology and LPI Capital go up and down completely randomly.
Pair Corralation between Cosmos Technology and LPI Capital
Assuming the 90 days trading horizon Cosmos Technology International is expected to under-perform the LPI Capital. In addition to that, Cosmos Technology is 3.46 times more volatile than LPI Capital Bhd. It trades about 0.0 of its total potential returns per unit of risk. LPI Capital Bhd is currently generating about 0.03 per unit of volatility. If you would invest 1,182 in LPI Capital Bhd on August 28, 2024 and sell it today you would earn a total of 140.00 from holding LPI Capital Bhd or generate 11.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cosmos Technology Internationa vs. LPI Capital Bhd
Performance |
| Timeline |
| Cosmos Technology |
| LPI Capital Bhd |
Cosmos Technology and LPI Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cosmos Technology and LPI Capital
The main advantage of trading using opposite Cosmos Technology and LPI Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cosmos Technology position performs unexpectedly, LPI Capital 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 LPI Capital will offset losses from the drop in LPI Capital's long position.| Cosmos Technology vs. Malayan Banking Bhd | Cosmos Technology vs. Public Bank Bhd | Cosmos Technology vs. Petronas Chemicals Group | Cosmos Technology vs. Tenaga Nasional Bhd |
| LPI Capital vs. EA Technique M | LPI Capital vs. PMB Technology Bhd | LPI Capital vs. Minetech Resources Bhd | LPI Capital vs. YX Precious Metals |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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