Correlation Between Datasonic Group and Cosmos Technology
Can any of the company-specific risk be diversified away by investing in both Datasonic 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 Datasonic 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 Datasonic Group Bhd and Cosmos Technology International, you can compare the effects of market volatilities on Datasonic 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 Datasonic Group with a short position of Cosmos Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Datasonic Group and Cosmos Technology.
Diversification Opportunities for Datasonic Group and Cosmos Technology
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Datasonic and Cosmos is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Datasonic Group Bhd and Cosmos Technology Internationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmos Technology and Datasonic 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 Datasonic Group Bhd 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 Datasonic Group i.e., Datasonic Group and Cosmos Technology go up and down completely randomly.
Pair Corralation between Datasonic Group and Cosmos Technology
Assuming the 90 days trading horizon Datasonic Group Bhd is expected to generate 0.65 times more return on investment than Cosmos Technology. However, Datasonic Group Bhd is 1.55 times less risky than Cosmos Technology. It trades about -0.24 of its potential returns per unit of risk. Cosmos Technology International is currently generating about -0.22 per unit of risk. If you would invest 43.00 in Datasonic Group Bhd on November 4, 2024 and sell it today you would lose (3.00) from holding Datasonic Group Bhd or give up 6.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Datasonic Group Bhd vs. Cosmos Technology Internationa
Performance |
| Timeline |
| Datasonic Group Bhd |
| Cosmos Technology |
Datasonic Group and Cosmos Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Datasonic Group and Cosmos Technology
The main advantage of trading using opposite Datasonic Group and Cosmos Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Datasonic 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.| Datasonic Group vs. Diversified Gateway Solutions | Datasonic Group vs. Kluang Rubber | Datasonic Group vs. Riverview Rubber Estates | Datasonic Group vs. CSC Steel Holdings |
| Cosmos Technology vs. Farm Price Holdings | Cosmos Technology vs. Uchi Technologies Bhd | Cosmos Technology vs. ES Ceramics Technology | Cosmos Technology vs. Rubberex M |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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