Correlation Between Jacquet Metal and Cogent Communications
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Cogent Communications 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 Jacquet Metal and Cogent Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Cogent Communications Holdings, you can compare the effects of market volatilities on Jacquet Metal and Cogent Communications 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 Jacquet Metal with a short position of Cogent Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Cogent Communications.
Diversification Opportunities for Jacquet Metal and Cogent Communications
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jacquet and Cogent is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Cogent Communications Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cogent Communications and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Cogent Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cogent Communications has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Cogent Communications go up and down completely randomly.
Pair Corralation between Jacquet Metal and Cogent Communications
Assuming the 90 days horizon Jacquet Metal Service is expected to under-perform the Cogent Communications. But the stock apears to be less risky and, when comparing its historical volatility, Jacquet Metal Service is 1.71 times less risky than Cogent Communications. The stock trades about -0.06 of its potential returns per unit of risk. The Cogent Communications Holdings is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 7,357 in Cogent Communications Holdings on September 3, 2024 and sell it today you would earn a total of 343.00 from holding Cogent Communications Holdings or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacquet Metal Service vs. Cogent Communications Holdings
Performance |
| Timeline |
| Jacquet Metal Service |
| Cogent Communications |
Jacquet Metal and Cogent Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Cogent Communications
The main advantage of trading using opposite Jacquet Metal and Cogent Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Cogent Communications 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 Cogent Communications will offset losses from the drop in Cogent Communications' long position.| Jacquet Metal vs. XLMedia PLC | Jacquet Metal vs. Tencent Music Entertainment | Jacquet Metal vs. ATRESMEDIA | Jacquet Metal vs. TOWNSQUARE MEDIA INC |
| Cogent Communications vs. T Mobile | Cogent Communications vs. China Mobile Limited | Cogent Communications vs. ATT Inc | Cogent Communications vs. Nippon Telegraph and |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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