Correlation Between COMSovereign Holding and APT Satellite

Can any of the company-specific risk be diversified away by investing in both COMSovereign Holding and APT Satellite 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 COMSovereign Holding and APT Satellite into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between COMSovereign Holding Corp and APT Satellite Holdings, you can compare the effects of market volatilities on COMSovereign Holding and APT Satellite 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 COMSovereign Holding with a short position of APT Satellite. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMSovereign Holding and APT Satellite.

Diversification Opportunities for COMSovereign Holding and APT Satellite

-0.38

Correlation Coefficient

COMSovereign Holding  APT Satellite

Very good diversification

The 3 months correlation between COMSovereign and APT is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding COMSovereign Holding Corp and APT Satellite Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APT Satellite Holdings and COMSovereign Holding 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 COMSovereign Holding Corp are associated (or correlated) with APT Satellite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APT Satellite Holdings has no effect on the direction of COMSovereign Holding i.e., COMSovereign Holding and APT Satellite go up and down completely randomly.

Pair Corralation between COMSovereign Holding and APT Satellite

Given the investment horizon of 90 days COMSovereign Holding Corp is expected to under-perform the APT Satellite. But the pink sheet apears to be less risky and, when comparing its historical volatility, COMSovereign Holding Corp is 1.36 times less risky than APT Satellite. The pink sheet trades about -0.01 of its potential returns per unit of risk. The APT Satellite Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  34.00  in APT Satellite Holdings on October 5, 2024 and sell it today you would lose (6.00) from holding APT Satellite Holdings or give up 17.65% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	57.59%
Values	Daily Returns

COMSovereign Holding Corp  vs.  APT Satellite Holdings

COMSovereign Holding Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

APT Satellite Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days APT Satellite Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking indicators, APT Satellite is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with COMSovereign Holding and APT Satellite

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

The idea behind COMSovereign Holding Corp and APT Satellite 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.

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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.