Correlation Between MOL Hungarian and Cohort

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

By analyzing existing cross correlation between MOL Hungarian Oil and Cohort, you can compare the effects of market volatilities on MOL Hungarian and Cohort 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 MOL Hungarian with a short position of Cohort. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOL Hungarian and Cohort.

Diversification Opportunities for MOL Hungarian and Cohort

0.51

Correlation Coefficient

MOL Hungarian  Cohort

Very weak diversification

The 3 months correlation between MOL and Cohort is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding MOL Hungarian Oil and Cohort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohort and MOL Hungarian 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 MOL Hungarian Oil are associated (or correlated) with Cohort. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohort has no effect on the direction of MOL Hungarian i.e., MOL Hungarian and Cohort go up and down completely randomly.

Pair Corralation between MOL Hungarian and Cohort

Assuming the 90 days trading horizon MOL Hungarian is expected to generate 479.78 times less return on investment than Cohort. But when comparing it to its historical volatility, MOL Hungarian Oil is 464.15 times less risky than Cohort. It trades about 0.13 of its potential returns per unit of risk. Cohort is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  125,000  in Cohort on April 24, 2025 and sell it today you would earn a total of  32,800  from holding Cohort or generate 26.24% return on investment over 90 days.

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

MOL Hungarian Oil  vs.  Cohort

MOL Hungarian Oil

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MOL Hungarian Oil are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, MOL Hungarian is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Cohort

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cohort are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Cohort unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MOL Hungarian and Cohort

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

The idea behind MOL Hungarian Oil and Cohort 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..