Correlation Between Cogent Communications and Shenandoah Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Cogent Communications and Shenandoah Telecommunicatio 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 Shenandoah Telecommunicatio 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 Shenandoah Telecommunications Co, you can compare the effects of market volatilities on Cogent Communications and Shenandoah Telecommunicatio 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 Shenandoah Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cogent Communications and Shenandoah Telecommunicatio.
Diversification Opportunities for Cogent Communications and Shenandoah Telecommunicatio
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cogent and Shenandoah is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Cogent Communications Group and Shenandoah Telecommunications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenandoah Telecommunicatio 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 Shenandoah Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenandoah Telecommunicatio has no effect on the direction of Cogent Communications i.e., Cogent Communications and Shenandoah Telecommunicatio go up and down completely randomly.
Pair Corralation between Cogent Communications and Shenandoah Telecommunicatio
Given the investment horizon of 90 days Cogent Communications Group is expected to generate 0.36 times more return on investment than Shenandoah Telecommunicatio. However, Cogent Communications Group is 2.8 times less risky than Shenandoah Telecommunicatio. It trades about 0.06 of its potential returns per unit of risk. Shenandoah Telecommunications Co is currently generating about -0.1 per unit of risk. If you would invest 8,229 in Cogent Communications Group on August 24, 2024 and sell it today you would earn a total of 150.00 from holding Cogent Communications Group or generate 1.82% 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. Shenandoah Telecommunications
Performance |
| Timeline |
| Cogent Communications |
| Shenandoah Telecommunicatio |
Cogent Communications and Shenandoah Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cogent Communications and Shenandoah Telecommunicatio
The main advantage of trading using opposite Cogent Communications and Shenandoah Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cogent Communications position performs unexpectedly, Shenandoah Telecommunicatio 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 Shenandoah Telecommunicatio will offset losses from the drop in Shenandoah Telecommunicatio's long position.| Cogent Communications vs. Liberty Broadband Srs | Cogent Communications vs. Charter Communications | Cogent Communications vs. Liberty Broadband Srs | Cogent Communications vs. TIM Participacoes SA |
| Shenandoah Telecommunicatio vs. Anterix | Shenandoah Telecommunicatio vs. Liberty Broadband Corp | Shenandoah Telecommunicatio vs. Ooma Inc | Shenandoah Telecommunicatio vs. IDT Corporation |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |