Correlation Between Charge Enterprises and Cogent Communications

Can any of the company-specific risk be diversified away by investing in both Charge Enterprises and Cogent Communications 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 Charge Enterprises and Cogent Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Charge Enterprises and Cogent Communications Group, you can compare the effects of market volatilities on Charge Enterprises and Cogent Communications 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 Charge Enterprises with a short position of Cogent Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Charge Enterprises and Cogent Communications.

Diversification Opportunities for Charge Enterprises and Cogent Communications

0.0

Correlation Coefficient

Charge Enterprises  Cogent Communications

Pay attention - limited upside

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

Pair Corralation between Charge Enterprises and Cogent Communications

If you would invest (100.00) in Charge Enterprises on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Charge Enterprises 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

Charge Enterprises  vs.  Cogent Communications Group

Charge Enterprises

Risk-Adjusted Performance

Very Weak

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

Cogent Communications

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cogent Communications Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Charge Enterprises and Cogent Communications

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

The idea behind Charge Enterprises and Cogent Communications Group 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.