Correlation Between Argo Investments and COG Financial
Can any of the company-specific risk be diversified away by investing in both Argo Investments and COG Financial 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 Argo Investments and COG Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argo Investments and COG Financial Services, you can compare the effects of market volatilities on Argo Investments and COG Financial 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 Argo Investments with a short position of COG Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argo Investments and COG Financial.
Diversification Opportunities for Argo Investments and COG Financial
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Argo and COG is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Argo Investments and COG Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COG Financial Services and Argo Investments 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 Argo Investments are associated (or correlated) with COG Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COG Financial Services has no effect on the direction of Argo Investments i.e., Argo Investments and COG Financial go up and down completely randomly.
Pair Corralation between Argo Investments and COG Financial
Assuming the 90 days trading horizon Argo Investments is expected to under-perform the COG Financial. But the stock apears to be less risky and, when comparing its historical volatility, Argo Investments is 3.37 times less risky than COG Financial. The stock trades about -0.04 of its potential returns per unit of risk. The COG Financial Services is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 90.00 in COG Financial Services on October 30, 2024 and sell it today you would earn a total of 8.00 from holding COG Financial Services or generate 8.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Argo Investments vs. COG Financial Services
Performance |
| Timeline |
| Argo Investments |
| COG Financial Services |
Argo Investments and COG Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argo Investments and COG Financial
The main advantage of trading using opposite Argo Investments and COG Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argo Investments position performs unexpectedly, COG Financial 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 COG Financial will offset losses from the drop in COG Financial's long position.| Argo Investments vs. Home Consortium | Argo Investments vs. Homeco Daily Needs | Argo Investments vs. Lendlease Group | Argo Investments vs. Dalaroo Metals |
| COG Financial vs. Aneka Tambang Tbk | COG Financial vs. Commonwealth Bank | COG Financial vs. Commonwealth Bank of | COG Financial vs. Australia and New |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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