Correlation Between Hasbro and Cogeco
Can any of the company-specific risk be diversified away by investing in both Hasbro and Cogeco 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 Hasbro and Cogeco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hasbro Inc and Cogeco Inc, you can compare the effects of market volatilities on Hasbro and Cogeco 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 Hasbro with a short position of Cogeco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hasbro and Cogeco.
Diversification Opportunities for Hasbro and Cogeco
Excellent diversification
The 3 months correlation between Hasbro and Cogeco is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Hasbro Inc and Cogeco Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cogeco Inc and Hasbro 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 Hasbro Inc are associated (or correlated) with Cogeco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cogeco Inc has no effect on the direction of Hasbro i.e., Hasbro and Cogeco go up and down completely randomly.
Pair Corralation between Hasbro and Cogeco
Considering the 90-day investment horizon Hasbro Inc is expected to under-perform the Cogeco. But the stock apears to be less risky and, when comparing its historical volatility, Hasbro Inc is 1.51 times less risky than Cogeco. The stock trades about -0.02 of its potential returns per unit of risk. The Cogeco Inc is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 5,193 in Cogeco Inc on February 7, 2024 and sell it today you would lose (1,413) from holding Cogeco Inc or give up 27.21% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 80.77% |
Values | Daily Returns |
Hasbro Inc vs. Cogeco Inc
Performance |
Timeline |
Hasbro Inc |
Cogeco Inc |
Hasbro and Cogeco Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hasbro and Cogeco
The main advantage of trading using opposite Hasbro and Cogeco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hasbro position performs unexpectedly, Cogeco 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 Cogeco will offset losses from the drop in Cogeco's long position.Hasbro vs. Planet Fitness | Hasbro vs. Funko Inc | Hasbro vs. Cedar Fair LP | Hasbro vs. OneSpaWorld Holdings |
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Check out your portfolio center.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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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