Correlation Between BORR DRILLING and Cogent Communications
Can any of the company-specific risk be diversified away by investing in both BORR DRILLING and Cogent Communications 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 BORR DRILLING and Cogent Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BORR DRILLING NEW and Cogent Communications Holdings, you can compare the effects of market volatilities on BORR DRILLING and Cogent Communications 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 BORR DRILLING with a short position of Cogent Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of BORR DRILLING and Cogent Communications.
Diversification Opportunities for BORR DRILLING and Cogent Communications
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BORR and Cogent is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding BORR DRILLING NEW and Cogent Communications Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cogent Communications and BORR DRILLING 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 BORR DRILLING NEW are associated (or correlated) with Cogent Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cogent Communications has no effect on the direction of BORR DRILLING i.e., BORR DRILLING and Cogent Communications go up and down completely randomly.
Pair Corralation between BORR DRILLING and Cogent Communications
Assuming the 90 days horizon BORR DRILLING NEW is expected to under-perform the Cogent Communications. In addition to that, BORR DRILLING is 1.3 times more volatile than Cogent Communications Holdings. It trades about -0.11 of its total potential returns per unit of risk. Cogent Communications Holdings is currently generating about 0.13 per unit of volatility. If you would invest 5,270 in Cogent Communications Holdings on August 25, 2024 and sell it today you would earn a total of 2,380 from holding Cogent Communications Holdings or generate 45.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BORR DRILLING NEW vs. Cogent Communications Holdings
Performance |
| Timeline |
| BORR DRILLING NEW |
| Cogent Communications |
BORR DRILLING and Cogent Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BORR DRILLING and Cogent Communications
The main advantage of trading using opposite BORR DRILLING and Cogent Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BORR DRILLING position performs unexpectedly, Cogent Communications 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 Cogent Communications will offset losses from the drop in Cogent Communications' long position.| BORR DRILLING vs. AWILCO DRILLING PLC | BORR DRILLING vs. CEOTRONICS | BORR DRILLING vs. Chiba Bank | BORR DRILLING vs. REVO INSURANCE SPA |
| Cogent Communications vs. T Mobile | Cogent Communications vs. ATT Inc | Cogent Communications vs. Deutsche Telekom AG | Cogent Communications vs. Nippon Telegraph and |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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