Correlation Between COG Financial and Audio Pixels

Can any of the company-specific risk be diversified away by investing in both COG Financial and Audio Pixels 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 COG Financial and Audio Pixels into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between COG Financial Services and Audio Pixels Holdings, you can compare the effects of market volatilities on COG Financial and Audio Pixels 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 COG Financial with a short position of Audio Pixels. Check out your portfolio center. Please also check ongoing floating volatility patterns of COG Financial and Audio Pixels.

Diversification Opportunities for COG Financial and Audio Pixels

0.0

Correlation Coefficient

COG Financial  Audio Pixels

Pay attention - limited upside

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

Pair Corralation between COG Financial and Audio Pixels

Assuming the 90 days trading horizon COG Financial Services is expected to under-perform the Audio Pixels. But the stock apears to be less risky and, when comparing its historical volatility, COG Financial Services is 1.76 times less risky than Audio Pixels. The stock trades about -0.02 of its potential returns per unit of risk. The Audio Pixels Holdings is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  950.00  in Audio Pixels Holdings on September 30, 2024 and sell it today you would lose (330.00) from holding Audio Pixels Holdings or give up 34.74% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

COG Financial Services  vs.  Audio Pixels Holdings

COG Financial Services

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in COG Financial Services are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, COG Financial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Audio Pixels Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with COG Financial and Audio Pixels

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

The idea behind COG Financial Services and Audio Pixels Holdings 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.

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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.