Correlation Between COSMOSTEEL HLDGS and BANK CIMB

Can any of the company-specific risk be diversified away by investing in both COSMOSTEEL HLDGS and BANK CIMB 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 COSMOSTEEL HLDGS and BANK CIMB into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between COSMOSTEEL HLDGS and BANK CIMB NIAGA, you can compare the effects of market volatilities on COSMOSTEEL HLDGS and BANK CIMB 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 COSMOSTEEL HLDGS with a short position of BANK CIMB. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSMOSTEEL HLDGS and BANK CIMB.

Diversification Opportunities for COSMOSTEEL HLDGS and BANK CIMB

0.0

Correlation Coefficient

COSMOSTEEL HLDGS  BANK CIMB

Pay attention - limited upside

The 3 months correlation between COSMOSTEEL and BANK is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding COSMOSTEEL HLDGS and BANK CIMB NIAGA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK CIMB NIAGA and COSMOSTEEL HLDGS 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 COSMOSTEEL HLDGS are associated (or correlated) with BANK CIMB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK CIMB NIAGA has no effect on the direction of COSMOSTEEL HLDGS i.e., COSMOSTEEL HLDGS and BANK CIMB go up and down completely randomly.

Pair Corralation between COSMOSTEEL HLDGS and BANK CIMB

If you would invest (100.00) in BANK CIMB NIAGA on October 8, 2024 and sell it today you would earn a total of  100.00  from holding BANK CIMB NIAGA or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

COSMOSTEEL HLDGS  vs.  BANK CIMB NIAGA

COSMOSTEEL HLDGS

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in COSMOSTEEL HLDGS are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, COSMOSTEEL HLDGS may actually be approaching a critical reversion point that can send shares even higher in February 2025.

BANK CIMB NIAGA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BANK CIMB NIAGA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, BANK CIMB is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with COSMOSTEEL HLDGS and BANK CIMB

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

The idea behind COSMOSTEEL HLDGS and BANK CIMB NIAGA 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.