Correlation Between Internet Thailand and Cogent Communications
Can any of the company-specific risk be diversified away by investing in both Internet Thailand 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 Internet Thailand and Cogent Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Internet Thailand PCL and Cogent Communications Holdings, you can compare the effects of market volatilities on Internet Thailand 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 Internet Thailand with a short position of Cogent Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Internet Thailand and Cogent Communications.
Diversification Opportunities for Internet Thailand and Cogent Communications
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Internet and Cogent is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Internet Thailand PCL and Cogent Communications Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cogent Communications and Internet Thailand 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 Internet Thailand PCL 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 Internet Thailand i.e., Internet Thailand and Cogent Communications go up and down completely randomly.
Pair Corralation between Internet Thailand and Cogent Communications
Assuming the 90 days trading horizon Internet Thailand is expected to generate 3.4 times less return on investment than Cogent Communications. In addition to that, Internet Thailand is 2.5 times more volatile than Cogent Communications Holdings. It trades about 0.02 of its total potential returns per unit of risk. Cogent Communications Holdings is currently generating about 0.2 per unit of volatility. If you would invest 7,100 in Cogent Communications Holdings on November 27, 2024 and sell it today you would earn a total of 550.00 from holding Cogent Communications Holdings or generate 7.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Internet Thailand PCL vs. Cogent Communications Holdings
Performance |
| Timeline |
| Internet Thailand PCL |
| Cogent Communications |
Internet Thailand and Cogent Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Internet Thailand and Cogent Communications
The main advantage of trading using opposite Internet Thailand and Cogent Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Internet Thailand 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.| Internet Thailand vs. CITY OFFICE REIT | Internet Thailand vs. KENEDIX OFFICE INV | Internet Thailand vs. PLAYTECH | Internet Thailand vs. MAVEN WIRELESS SWEDEN |
| Cogent Communications vs. PARKEN Sport Entertainment | Cogent Communications vs. Universal Entertainment | Cogent Communications vs. CNVISION MEDIA | Cogent Communications vs. SQUIRREL MEDIA SA |
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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