Correlation Between COSMO FIRST and Borosil Scientific

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

By analyzing existing cross correlation between COSMO FIRST LIMITED and Borosil Scientific, you can compare the effects of market volatilities on COSMO FIRST and Borosil Scientific 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 COSMO FIRST with a short position of Borosil Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSMO FIRST and Borosil Scientific.

Diversification Opportunities for COSMO FIRST and Borosil Scientific

0.65

Correlation Coefficient

COSMO FIRST  Borosil Scientific

Poor diversification

The 3 months correlation between COSMO and Borosil is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding COSMO FIRST LIMITED and Borosil Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Borosil Scientific and COSMO FIRST 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 COSMO FIRST LIMITED are associated (or correlated) with Borosil Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Borosil Scientific has no effect on the direction of COSMO FIRST i.e., COSMO FIRST and Borosil Scientific go up and down completely randomly.

Pair Corralation between COSMO FIRST and Borosil Scientific

Assuming the 90 days trading horizon COSMO FIRST LIMITED is expected to generate 1.32 times more return on investment than Borosil Scientific. However, COSMO FIRST is 1.32 times more volatile than Borosil Scientific. It trades about 0.24 of its potential returns per unit of risk. Borosil Scientific is currently generating about 0.14 per unit of risk. If you would invest  60,115  in COSMO FIRST LIMITED on April 20, 2025 and sell it today you would earn a total of  53,585  from holding COSMO FIRST LIMITED or generate 89.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.46%
Values	Daily Returns

COSMO FIRST LIMITED  vs.  Borosil Scientific

COSMO FIRST LIMITED

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in COSMO FIRST LIMITED are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, COSMO FIRST demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Borosil Scientific

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Borosil Scientific are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting basic indicators, Borosil Scientific demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with COSMO FIRST and Borosil Scientific

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

The idea behind COSMO FIRST LIMITED and Borosil Scientific 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.