Correlation Between CosmoSteel Holdings and Boiron SA
Can any of the company-specific risk be diversified away by investing in both CosmoSteel Holdings and Boiron SA 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 CosmoSteel Holdings and Boiron SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CosmoSteel Holdings Limited and Boiron SA, you can compare the effects of market volatilities on CosmoSteel Holdings and Boiron SA 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 CosmoSteel Holdings with a short position of Boiron SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of CosmoSteel Holdings and Boiron SA.
Diversification Opportunities for CosmoSteel Holdings and Boiron SA
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CosmoSteel and Boiron is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding CosmoSteel Holdings Limited and Boiron SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boiron SA and CosmoSteel Holdings 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 CosmoSteel Holdings Limited are associated (or correlated) with Boiron SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boiron SA has no effect on the direction of CosmoSteel Holdings i.e., CosmoSteel Holdings and Boiron SA go up and down completely randomly.
Pair Corralation between CosmoSteel Holdings and Boiron SA
Assuming the 90 days horizon CosmoSteel Holdings Limited is expected to generate 1.41 times more return on investment than Boiron SA. However, CosmoSteel Holdings is 1.41 times more volatile than Boiron SA. It trades about -0.01 of its potential returns per unit of risk. Boiron SA is currently generating about -0.45 per unit of risk. If you would invest 6.10 in CosmoSteel Holdings Limited on August 30, 2024 and sell it today you would lose (0.05) from holding CosmoSteel Holdings Limited or give up 0.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CosmoSteel Holdings Limited vs. Boiron SA
Performance |
| Timeline |
| CosmoSteel Holdings |
| Boiron SA |
CosmoSteel Holdings and Boiron SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CosmoSteel Holdings and Boiron SA
The main advantage of trading using opposite CosmoSteel Holdings and Boiron SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CosmoSteel Holdings position performs unexpectedly, Boiron SA 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 Boiron SA will offset losses from the drop in Boiron SA's long position.| CosmoSteel Holdings vs. Superior Plus Corp | CosmoSteel Holdings vs. SIVERS SEMICONDUCTORS AB | CosmoSteel Holdings vs. Identiv | CosmoSteel Holdings vs. Intel |
| Boiron SA vs. AstraZeneca PLC | Boiron SA vs. Superior Plus Corp | Boiron SA vs. SIVERS SEMICONDUCTORS AB | Boiron SA vs. Identiv |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |