Correlation Between Cots Technology and Osang Healthcare
Can any of the company-specific risk be diversified away by investing in both Cots Technology and Osang Healthcare 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 Cots Technology and Osang Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cots Technology Co and Osang Healthcare Co,Ltd, you can compare the effects of market volatilities on Cots Technology and Osang Healthcare 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 Cots Technology with a short position of Osang Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cots Technology and Osang Healthcare.
Diversification Opportunities for Cots Technology and Osang Healthcare
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cots and Osang is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Cots Technology Co and Osang Healthcare Co,Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osang Healthcare Co,Ltd and Cots 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 Cots Technology Co are associated (or correlated) with Osang Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osang Healthcare Co,Ltd has no effect on the direction of Cots Technology i.e., Cots Technology and Osang Healthcare go up and down completely randomly.
Pair Corralation between Cots Technology and Osang Healthcare
Assuming the 90 days trading horizon Cots Technology Co is expected to generate 1.36 times more return on investment than Osang Healthcare. However, Cots Technology is 1.36 times more volatile than Osang Healthcare Co,Ltd. It trades about 0.01 of its potential returns per unit of risk. Osang Healthcare Co,Ltd is currently generating about -0.13 per unit of risk. If you would invest 2,040,000 in Cots Technology Co on August 30, 2024 and sell it today you would lose (421,000) from holding Cots Technology Co or give up 20.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 55.06% |
| Values | Daily Returns |
Cots Technology Co vs. Osang Healthcare Co,Ltd
Performance |
| Timeline |
| Cots Technology |
| Osang Healthcare Co,Ltd |
Cots Technology and Osang Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cots Technology and Osang Healthcare
The main advantage of trading using opposite Cots Technology and Osang Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cots Technology position performs unexpectedly, Osang Healthcare 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 Osang Healthcare will offset losses from the drop in Osang Healthcare's long position.| Cots Technology vs. Samsung Electronics Co | Cots Technology vs. Samsung Electronics Co | Cots Technology vs. LG Energy Solution | Cots Technology vs. SK Hynix |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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