Correlation Between Uchi Technologies and Cosmos Technology
Can any of the company-specific risk be diversified away by investing in both Uchi Technologies 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 Uchi Technologies and Cosmos Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uchi Technologies Bhd and Cosmos Technology International, you can compare the effects of market volatilities on Uchi Technologies 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 Uchi Technologies with a short position of Cosmos Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uchi Technologies and Cosmos Technology.
Diversification Opportunities for Uchi Technologies and Cosmos Technology
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Uchi and Cosmos is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Uchi Technologies 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 Uchi Technologies 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 Uchi Technologies 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 Uchi Technologies i.e., Uchi Technologies and Cosmos Technology go up and down completely randomly.
Pair Corralation between Uchi Technologies and Cosmos Technology
Assuming the 90 days trading horizon Uchi Technologies is expected to generate 1.71 times less return on investment than Cosmos Technology. But when comparing it to its historical volatility, Uchi Technologies Bhd is 2.2 times less risky than Cosmos Technology. It trades about 0.06 of its potential returns per unit of risk. Cosmos Technology International is currently generating about 0.05 of returns per unit of risk over similar time horizon. 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 |
Uchi Technologies Bhd vs. Cosmos Technology Internationa
Performance |
| Timeline |
| Uchi Technologies Bhd |
| Cosmos Technology |
Uchi Technologies and Cosmos Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uchi Technologies and Cosmos Technology
The main advantage of trading using opposite Uchi Technologies and Cosmos Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uchi Technologies 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.| Uchi Technologies vs. Oriental Food Industries | Uchi Technologies vs. Malaysia Steel Works | Uchi Technologies vs. Alliance Financial Group | Uchi Technologies vs. Media Prima Bhd |
| Cosmos Technology vs. ES Ceramics Technology | Cosmos Technology vs. TAS Offshore Bhd | Cosmos Technology vs. Awanbiru Technology Bhd | Cosmos Technology vs. Greatech Technology 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 Stocks Directory module to find actively traded stocks across global markets.
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