Correlation Between Pantech Group and Cosmos Technology
Can any of the company-specific risk be diversified away by investing in both Pantech Group and Cosmos Technology 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 Pantech Group and Cosmos Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pantech Group Holdings and Cosmos Technology International, you can compare the effects of market volatilities on Pantech Group and Cosmos Technology 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 Pantech Group with a short position of Cosmos Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pantech Group and Cosmos Technology.
Diversification Opportunities for Pantech Group and Cosmos Technology
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Pantech and Cosmos is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Pantech Group Holdings and Cosmos Technology Internationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmos Technology and Pantech Group 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 Pantech Group Holdings are associated (or correlated) with Cosmos Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosmos Technology has no effect on the direction of Pantech Group i.e., Pantech Group and Cosmos Technology go up and down completely randomly.
Pair Corralation between Pantech Group and Cosmos Technology
Assuming the 90 days trading horizon Pantech Group Holdings is expected to generate 0.55 times more return on investment than Cosmos Technology. However, Pantech Group Holdings is 1.81 times less risky than Cosmos Technology. It trades about 0.07 of its potential returns per unit of risk. Cosmos Technology International is currently generating about 0.0 per unit of risk. If you would invest 67.00 in Pantech Group Holdings on August 27, 2024 and sell it today you would earn a total of 29.00 from holding Pantech Group Holdings or generate 43.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pantech Group Holdings vs. Cosmos Technology Internationa
Performance |
| Timeline |
| Pantech Group Holdings |
| Cosmos Technology |
Pantech Group and Cosmos Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pantech Group and Cosmos Technology
The main advantage of trading using opposite Pantech Group and Cosmos Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pantech Group position performs unexpectedly, Cosmos Technology 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 Cosmos Technology will offset losses from the drop in Cosmos Technology's long position.| Pantech Group vs. Eonmetall Group Bhd | Pantech Group vs. Press Metal Bhd | Pantech Group vs. Sungei Bagan Rubber | Pantech Group vs. Petronas Chemicals Group |
| Cosmos Technology vs. Malayan Banking Bhd | Cosmos Technology vs. Public Bank Bhd | Cosmos Technology vs. Petronas Chemicals Group | Cosmos Technology vs. Tenaga Nasional 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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