Correlation Between Cogent Communications and Soken Chemical
Can any of the company-specific risk be diversified away by investing in both Cogent Communications and Soken Chemical 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 Cogent Communications and Soken Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cogent Communications Holdings and Soken Chemical Engineering, you can compare the effects of market volatilities on Cogent Communications and Soken Chemical 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 Cogent Communications with a short position of Soken Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cogent Communications and Soken Chemical.
Diversification Opportunities for Cogent Communications and Soken Chemical
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cogent and Soken is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cogent Communications Holdings and Soken Chemical Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soken Chemical Engin and Cogent Communications 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 Cogent Communications Holdings are associated (or correlated) with Soken Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soken Chemical Engin has no effect on the direction of Cogent Communications i.e., Cogent Communications and Soken Chemical go up and down completely randomly.
Pair Corralation between Cogent Communications and Soken Chemical
If you would invest 4,675 in Cogent Communications Holdings on September 14, 2024 and sell it today you would earn a total of 2,575 from holding Cogent Communications Holdings or generate 55.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cogent Communications Holdings vs. Soken Chemical Engineering
Performance |
| Timeline |
| Cogent Communications |
| Soken Chemical Engin |
Cogent Communications and Soken Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cogent Communications and Soken Chemical
The main advantage of trading using opposite Cogent Communications and Soken Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cogent Communications position performs unexpectedly, Soken Chemical 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 Soken Chemical will offset losses from the drop in Soken Chemical's long position.| Cogent Communications vs. Superior Plus Corp | Cogent Communications vs. SIVERS SEMICONDUCTORS AB | Cogent Communications vs. Norsk Hydro ASA | Cogent Communications vs. Reliance Steel Aluminum |
| Soken Chemical vs. Carsales | Soken Chemical vs. Gaztransport Technigaz SA | Soken Chemical vs. SALESFORCE INC CDR | Soken Chemical vs. Big 5 Sporting |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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