Correlation Between Cogent Communications and Ast Spacemobile
Can any of the company-specific risk be diversified away by investing in both Cogent Communications and Ast Spacemobile 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 Cogent Communications and Ast Spacemobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cogent Communications Group and Ast Spacemobile, you can compare the effects of market volatilities on Cogent Communications and Ast Spacemobile 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 Cogent Communications with a short position of Ast Spacemobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cogent Communications and Ast Spacemobile.
Diversification Opportunities for Cogent Communications and Ast Spacemobile
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cogent and Ast is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Cogent Communications Group and Ast Spacemobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ast Spacemobile and Cogent Communications 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 Cogent Communications Group are associated (or correlated) with Ast Spacemobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ast Spacemobile has no effect on the direction of Cogent Communications i.e., Cogent Communications and Ast Spacemobile go up and down completely randomly.
Pair Corralation between Cogent Communications and Ast Spacemobile
Given the investment horizon of 90 days Cogent Communications Group is expected to generate 0.28 times more return on investment than Ast Spacemobile. However, Cogent Communications Group is 3.62 times less risky than Ast Spacemobile. It trades about 0.05 of its potential returns per unit of risk. Ast Spacemobile is currently generating about -0.02 per unit of risk. If you would invest 8,188 in Cogent Communications Group on August 26, 2024 and sell it today you would earn a total of 128.00 from holding Cogent Communications Group or generate 1.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cogent Communications Group vs. Ast Spacemobile
Performance |
| Timeline |
| Cogent Communications |
| Ast Spacemobile |
Cogent Communications and Ast Spacemobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cogent Communications and Ast Spacemobile
The main advantage of trading using opposite Cogent Communications and Ast Spacemobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cogent Communications position performs unexpectedly, Ast Spacemobile 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 Ast Spacemobile will offset losses from the drop in Ast Spacemobile's long position.| Cogent Communications vs. Liberty Broadband Srs | Cogent Communications vs. Ribbon Communications | Cogent Communications vs. Liberty Broadband Srs | Cogent Communications vs. Shenandoah Telecommunications Co |
| Ast Spacemobile vs. Iridium Communications | Ast Spacemobile vs. Lumen Technologies | Ast Spacemobile vs. Sify Technologies Limited | Ast Spacemobile vs. InterDigital |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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