Correlation Between Ironbark Capital and CogState
Can any of the company-specific risk be diversified away by investing in both Ironbark Capital and CogState 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 Ironbark Capital and CogState into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ironbark Capital and CogState, you can compare the effects of market volatilities on Ironbark Capital and CogState 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 Ironbark Capital with a short position of CogState. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ironbark Capital and CogState.
Diversification Opportunities for Ironbark Capital and CogState
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ironbark and CogState is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ironbark Capital and CogState in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CogState and Ironbark Capital 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 Ironbark Capital are associated (or correlated) with CogState. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CogState has no effect on the direction of Ironbark Capital i.e., Ironbark Capital and CogState go up and down completely randomly.
Pair Corralation between Ironbark Capital and CogState
Assuming the 90 days trading horizon Ironbark Capital is expected to under-perform the CogState. But the stock apears to be less risky and, when comparing its historical volatility, Ironbark Capital is 5.03 times less risky than CogState. The stock trades about -0.22 of its potential returns per unit of risk. The CogState is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 114.00 in CogState on November 3, 2024 and sell it today you would earn a total of 1.00 from holding CogState or generate 0.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ironbark Capital vs. CogState
Performance |
| Timeline |
| Ironbark Capital |
| CogState |
Ironbark Capital and CogState Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ironbark Capital and CogState
The main advantage of trading using opposite Ironbark Capital and CogState positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ironbark Capital position performs unexpectedly, CogState 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 CogState will offset losses from the drop in CogState's long position.| Ironbark Capital vs. MFF Capital Investments | Ironbark Capital vs. Group 6 Metals | Ironbark Capital vs. Falcon Metals | Ironbark Capital vs. Medical Developments International |
| CogState vs. Ainsworth Game Technology | CogState vs. Bailador Technology Invest | CogState vs. Carnegie Clean Energy | CogState vs. Argo Investments |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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