Correlation Between Cosco Capital and Balai Ni

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

By analyzing existing cross correlation between Cosco Capital and Balai Ni Fruitas, you can compare the effects of market volatilities on Cosco Capital and Balai Ni 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 Cosco Capital with a short position of Balai Ni. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosco Capital and Balai Ni.

Diversification Opportunities for Cosco Capital and Balai Ni

0.4

Correlation Coefficient

Cosco Capital  Balai Ni

Very weak diversification

The 3 months correlation between Cosco and Balai is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Cosco Capital and Balai Ni Fruitas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Balai Ni Fruitas and Cosco Capital 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 Cosco Capital are associated (or correlated) with Balai Ni. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Balai Ni Fruitas has no effect on the direction of Cosco Capital i.e., Cosco Capital and Balai Ni go up and down completely randomly.

Pair Corralation between Cosco Capital and Balai Ni

Assuming the 90 days trading horizon Cosco Capital is expected to generate 0.41 times more return on investment than Balai Ni. However, Cosco Capital is 2.41 times less risky than Balai Ni. It trades about 0.25 of its potential returns per unit of risk. Balai Ni Fruitas is currently generating about 0.08 per unit of risk. If you would invest  570.00  in Cosco Capital on April 24, 2025 and sell it today you would earn a total of  130.00  from holding Cosco Capital or generate 22.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	81.67%
Values	Daily Returns

Cosco Capital  vs.  Balai Ni Fruitas

Cosco Capital

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cosco Capital are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Cosco Capital reported solid returns over the last few months and may actually be approaching a breakup point.

Balai Ni Fruitas

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Balai Ni Fruitas are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak essential indicators, Balai Ni reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cosco Capital and Balai Ni

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

The idea behind Cosco Capital and Balai Ni Fruitas 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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.