Correlation Between A10 Network and COSCO SHIPPING
Can any of the company-specific risk be diversified away by investing in both A10 Network and COSCO SHIPPING 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 A10 Network and COSCO SHIPPING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between A10 Network and COSCO SHIPPING Holdings, you can compare the effects of market volatilities on A10 Network and COSCO SHIPPING 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 A10 Network with a short position of COSCO SHIPPING. Check out your portfolio center. Please also check ongoing floating volatility patterns of A10 Network and COSCO SHIPPING.
Diversification Opportunities for A10 Network and COSCO SHIPPING
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between A10 and COSCO is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding A10 Network and COSCO SHIPPING Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COSCO SHIPPING Holdings and A10 Network 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 A10 Network are associated (or correlated) with COSCO SHIPPING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COSCO SHIPPING Holdings has no effect on the direction of A10 Network i.e., A10 Network and COSCO SHIPPING go up and down completely randomly.
Pair Corralation between A10 Network and COSCO SHIPPING
Given the investment horizon of 90 days A10 Network is expected to under-perform the COSCO SHIPPING. But the stock apears to be less risky and, when comparing its historical volatility, A10 Network is 1.43 times less risky than COSCO SHIPPING. The stock trades about -0.04 of its potential returns per unit of risk. The COSCO SHIPPING Holdings is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 666.00 in COSCO SHIPPING Holdings on March 5, 2024 and sell it today you would earn a total of 179.00 from holding COSCO SHIPPING Holdings or generate 26.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
A10 Network vs. COSCO SHIPPING Holdings
Performance |
Timeline |
A10 Network |
COSCO SHIPPING Holdings |
A10 Network and COSCO SHIPPING Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with A10 Network and COSCO SHIPPING
The main advantage of trading using opposite A10 Network and COSCO SHIPPING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if A10 Network position performs unexpectedly, COSCO SHIPPING 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 COSCO SHIPPING will offset losses from the drop in COSCO SHIPPING's long position.A10 Network vs. Block Inc | A10 Network vs. Adobe Systems Incorporated | A10 Network vs. Crowdstrike Holdings | A10 Network vs. Cloudflare |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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