Correlation Between Cognyte Software and YS Biopharma

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

By analyzing existing cross correlation between Cognyte Software and YS Biopharma Co,, you can compare the effects of market volatilities on Cognyte Software and YS Biopharma 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 Cognyte Software with a short position of YS Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cognyte Software and YS Biopharma.

Diversification Opportunities for Cognyte Software and YS Biopharma

0.69

Correlation Coefficient

Cognyte Software  YS Biopharma

Poor diversification

The 3 months correlation between Cognyte and YS Biopharma is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Cognyte Software and YS Biopharma Co, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YS Biopharma Co, and Cognyte Software 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 Cognyte Software are associated (or correlated) with YS Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YS Biopharma Co, has no effect on the direction of Cognyte Software i.e., Cognyte Software and YS Biopharma go up and down completely randomly.

Pair Corralation between Cognyte Software and YS Biopharma

Given the investment horizon of 90 days Cognyte Software is expected to generate 0.5 times more return on investment than YS Biopharma. However, Cognyte Software is 2.01 times less risky than YS Biopharma. It trades about 0.07 of its potential returns per unit of risk. YS Biopharma Co, is currently generating about -0.06 per unit of risk. If you would invest  272.00  in Cognyte Software on July 20, 2024 and sell it today you would earn a total of  429.00  from holding Cognyte Software or generate 157.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	88.28%
Values	Daily Returns

Cognyte Software  vs.  YS Biopharma Co,

Cognyte Software

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cognyte Software has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cognyte Software is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

YS Biopharma Co,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days YS Biopharma Co, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in November 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Cognyte Software and YS Biopharma

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

The idea behind Cognyte Software and YS Biopharma Co, 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.

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 Transaction History module to view history of all your transactions and understand their impact on performance.