Correlation Between MINCO SILVER and Cogent Communications
Can any of the company-specific risk be diversified away by investing in both MINCO SILVER 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 MINCO SILVER and Cogent Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MINCO SILVER and Cogent Communications Holdings, you can compare the effects of market volatilities on MINCO SILVER 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 MINCO SILVER with a short position of Cogent Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of MINCO SILVER and Cogent Communications.
Diversification Opportunities for MINCO SILVER and Cogent Communications
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MINCO and Cogent is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding MINCO SILVER and Cogent Communications Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cogent Communications and MINCO SILVER 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 MINCO SILVER 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 MINCO SILVER i.e., MINCO SILVER and Cogent Communications go up and down completely randomly.
Pair Corralation between MINCO SILVER and Cogent Communications
Assuming the 90 days trading horizon MINCO SILVER is expected to generate 7.9 times less return on investment than Cogent Communications. In addition to that, MINCO SILVER is 1.13 times more volatile than Cogent Communications Holdings. It trades about 0.01 of its total potential returns per unit of risk. Cogent Communications Holdings is currently generating about 0.11 per unit of volatility. 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 |
MINCO SILVER vs. Cogent Communications Holdings
Performance |
| Timeline |
| MINCO SILVER |
| Cogent Communications |
MINCO SILVER and Cogent Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MINCO SILVER and Cogent Communications
The main advantage of trading using opposite MINCO SILVER and Cogent Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MINCO SILVER 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.| MINCO SILVER vs. TOTAL GABON | MINCO SILVER vs. Walgreens Boots Alliance | MINCO SILVER vs. Peak Resources Limited |
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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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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