Correlation Between Cosmo Metals and Pengana Private

Can any of the company-specific risk be diversified away by investing in both Cosmo Metals and Pengana Private 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 Cosmo Metals and Pengana Private into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cosmo Metals and Pengana Private Equity, you can compare the effects of market volatilities on Cosmo Metals and Pengana Private 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 Cosmo Metals with a short position of Pengana Private. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosmo Metals and Pengana Private.

Diversification Opportunities for Cosmo Metals and Pengana Private

0.28

Correlation Coefficient

Cosmo Metals  Pengana Private

Modest diversification

The 3 months correlation between Cosmo and Pengana is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Cosmo Metals and Pengana Private Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pengana Private Equity and Cosmo Metals 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 Cosmo Metals are associated (or correlated) with Pengana Private. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pengana Private Equity has no effect on the direction of Cosmo Metals i.e., Cosmo Metals and Pengana Private go up and down completely randomly.

Pair Corralation between Cosmo Metals and Pengana Private

Assuming the 90 days trading horizon Cosmo Metals is expected to under-perform the Pengana Private. In addition to that, Cosmo Metals is 1.33 times more volatile than Pengana Private Equity. It trades about -0.01 of its total potential returns per unit of risk. Pengana Private Equity is currently generating about 0.08 per unit of volatility. If you would invest  123.00  in Pengana Private Equity on October 24, 2024 and sell it today you would earn a total of  13.00  from holding Pengana Private Equity or generate 10.57% return on investment over 90 days.

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

Cosmo Metals  vs.  Pengana Private Equity

Cosmo Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cosmo Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cosmo Metals is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pengana Private Equity

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Pengana Private Equity are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Pengana Private may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Cosmo Metals and Pengana Private

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

The idea behind Cosmo Metals and Pengana Private Equity 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.