Correlation Between COSMOSTEEL HLDGS and Japan Asia
Can any of the company-specific risk be diversified away by investing in both COSMOSTEEL HLDGS and Japan Asia 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 HLDGS and Japan Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COSMOSTEEL HLDGS and Japan Asia Investment, you can compare the effects of market volatilities on COSMOSTEEL HLDGS and Japan Asia 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 HLDGS with a short position of Japan Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSMOSTEEL HLDGS and Japan Asia.
Diversification Opportunities for COSMOSTEEL HLDGS and Japan Asia
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between COSMOSTEEL and Japan is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding COSMOSTEEL HLDGS and Japan Asia Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japan Asia Investment and COSMOSTEEL HLDGS 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 HLDGS are associated (or correlated) with Japan Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japan Asia Investment has no effect on the direction of COSMOSTEEL HLDGS i.e., COSMOSTEEL HLDGS and Japan Asia go up and down completely randomly.
Pair Corralation between COSMOSTEEL HLDGS and Japan Asia
Assuming the 90 days trading horizon COSMOSTEEL HLDGS is expected to generate 1.02 times more return on investment than Japan Asia. However, COSMOSTEEL HLDGS is 1.02 times more volatile than Japan Asia Investment. It trades about 0.02 of its potential returns per unit of risk. Japan Asia Investment is currently generating about 0.0 per unit of risk. If you would invest 6.19 in COSMOSTEEL HLDGS on October 12, 2024 and sell it today you would earn a total of 0.56 from holding COSMOSTEEL HLDGS or generate 9.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COSMOSTEEL HLDGS vs. Japan Asia Investment
Performance |
| Timeline |
| COSMOSTEEL HLDGS |
| Japan Asia Investment |
COSMOSTEEL HLDGS and Japan Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COSMOSTEEL HLDGS and Japan Asia
The main advantage of trading using opposite COSMOSTEEL HLDGS and Japan Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COSMOSTEEL HLDGS position performs unexpectedly, Japan Asia 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 Japan Asia will offset losses from the drop in Japan Asia's long position.| COSMOSTEEL HLDGS vs. PT Wintermar Offshore | COSMOSTEEL HLDGS vs. Singapore Reinsurance | COSMOSTEEL HLDGS vs. Vienna Insurance Group | COSMOSTEEL HLDGS vs. Japan Post Insurance |
| Japan Asia vs. Ameriprise Financial | Japan Asia vs. PNC Financial Services | Japan Asia vs. COSMOSTEEL HLDGS | Japan Asia vs. ANGANG STEEL H |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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