Correlation Between Cosmos Technology and Uwc Bhd

Can any of the company-specific risk be diversified away by investing in both Cosmos Technology and Uwc Bhd 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 Cosmos Technology and Uwc Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cosmos Technology International and Uwc Bhd, you can compare the effects of market volatilities on Cosmos Technology and Uwc Bhd 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 Cosmos Technology with a short position of Uwc Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosmos Technology and Uwc Bhd.

Diversification Opportunities for Cosmos Technology and Uwc Bhd

0.49

Correlation Coefficient

Cosmos Technology  Uwc Bhd

Very weak diversification

The 3 months correlation between Cosmos and Uwc is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Cosmos Technology Internationa and Uwc Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uwc Bhd and Cosmos Technology 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 Cosmos Technology International are associated (or correlated) with Uwc Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uwc Bhd has no effect on the direction of Cosmos Technology i.e., Cosmos Technology and Uwc Bhd go up and down completely randomly.

Pair Corralation between Cosmos Technology and Uwc Bhd

Assuming the 90 days trading horizon Cosmos Technology is expected to generate 2.21 times less return on investment than Uwc Bhd. In addition to that, Cosmos Technology is 1.05 times more volatile than Uwc Bhd. It trades about 0.2 of its total potential returns per unit of risk. Uwc Bhd is currently generating about 0.46 per unit of volatility. If you would invest  258.00  in Uwc Bhd on October 8, 2024 and sell it today you would earn a total of  46.00  from holding Uwc Bhd or generate 17.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Cosmos Technology Internationa  vs.  Uwc Bhd

Cosmos Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cosmos Technology International are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Cosmos Technology disclosed solid returns over the last few months and may actually be approaching a breakup point.

Uwc Bhd

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Uwc Bhd are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Uwc Bhd disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cosmos Technology and Uwc Bhd

The main advantage of trading using opposite Cosmos Technology and Uwc Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cosmos Technology position performs unexpectedly, Uwc Bhd 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 Uwc Bhd will offset losses from the drop in Uwc Bhd's long position.

The idea behind Cosmos Technology International and Uwc Bhd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.