Correlation Between PENN NATL and COSMOSTEEL HLDGS
Can any of the company-specific risk be diversified away by investing in both PENN NATL and COSMOSTEEL HLDGS 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 PENN NATL and COSMOSTEEL HLDGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PENN NATL GAMING and COSMOSTEEL HLDGS, you can compare the effects of market volatilities on PENN NATL and COSMOSTEEL HLDGS 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 PENN NATL with a short position of COSMOSTEEL HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of PENN NATL and COSMOSTEEL HLDGS.
Diversification Opportunities for PENN NATL and COSMOSTEEL HLDGS
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PENN and COSMOSTEEL is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding PENN NATL GAMING and COSMOSTEEL HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COSMOSTEEL HLDGS and PENN NATL 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 PENN NATL GAMING are associated (or correlated) with COSMOSTEEL HLDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COSMOSTEEL HLDGS has no effect on the direction of PENN NATL i.e., PENN NATL and COSMOSTEEL HLDGS go up and down completely randomly.
Pair Corralation between PENN NATL and COSMOSTEEL HLDGS
Assuming the 90 days trading horizon PENN NATL GAMING is expected to under-perform the COSMOSTEEL HLDGS. In addition to that, PENN NATL is 1.14 times more volatile than COSMOSTEEL HLDGS. It trades about 0.0 of its total potential returns per unit of risk. COSMOSTEEL HLDGS is currently generating about 0.0 per unit of volatility. If you would invest 6.93 in COSMOSTEEL HLDGS on September 2, 2024 and sell it today you would lose (0.68) from holding COSMOSTEEL HLDGS or give up 9.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PENN NATL GAMING vs. COSMOSTEEL HLDGS
Performance |
| Timeline |
| PENN NATL GAMING |
| COSMOSTEEL HLDGS |
PENN NATL and COSMOSTEEL HLDGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PENN NATL and COSMOSTEEL HLDGS
The main advantage of trading using opposite PENN NATL and COSMOSTEEL HLDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PENN NATL position performs unexpectedly, COSMOSTEEL HLDGS 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 COSMOSTEEL HLDGS will offset losses from the drop in COSMOSTEEL HLDGS's long position.| PENN NATL vs. SIVERS SEMICONDUCTORS AB | PENN NATL vs. Darden Restaurants | PENN NATL vs. Reliance Steel Aluminum | PENN NATL vs. Q2M Managementberatung AG |
| COSMOSTEEL HLDGS vs. MOVIE GAMES SA | COSMOSTEEL HLDGS vs. American Airlines Group | COSMOSTEEL HLDGS vs. BW OFFSHORE LTD | COSMOSTEEL HLDGS vs. Aegean Airlines 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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