Correlation Between CogState and BSP Financial
Can any of the company-specific risk be diversified away by investing in both CogState and BSP 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 CogState and BSP Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CogState and BSP Financial Group, you can compare the effects of market volatilities on CogState and BSP 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 CogState with a short position of BSP Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of CogState and BSP Financial.
Diversification Opportunities for CogState and BSP Financial
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CogState and BSP is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding CogState and BSP Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BSP Financial Group and CogState 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 CogState are associated (or correlated) with BSP Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BSP Financial Group has no effect on the direction of CogState i.e., CogState and BSP Financial go up and down completely randomly.
Pair Corralation between CogState and BSP Financial
Assuming the 90 days trading horizon CogState is expected to generate 1.38 times more return on investment than BSP Financial. However, CogState is 1.38 times more volatile than BSP Financial Group. It trades about 0.37 of its potential returns per unit of risk. BSP Financial Group is currently generating about 0.13 per unit of risk. If you would invest 98.00 in CogState on September 13, 2024 and sell it today you would earn a total of 21.00 from holding CogState or generate 21.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CogState vs. BSP Financial Group
Performance |
| Timeline |
| CogState |
| BSP Financial Group |
CogState and BSP Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CogState and BSP Financial
The main advantage of trading using opposite CogState and BSP Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CogState position performs unexpectedly, BSP 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 BSP Financial will offset losses from the drop in BSP Financial's long position.| CogState vs. Bisalloy Steel Group | CogState vs. Treasury Wine Estates | CogState vs. Tombador Iron | CogState vs. Legacy Iron Ore |
| BSP Financial vs. Stelar Metals | BSP Financial vs. Truscott Mining Corp | BSP Financial vs. Iron Road | BSP Financial vs. Falcon Metals |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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