Correlation Between Cosmos Group and CYIOS

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

By analyzing existing cross correlation between Cosmos Group Holdings and CYIOS, you can compare the effects of market volatilities on Cosmos Group and CYIOS 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 Cosmos Group with a short position of CYIOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosmos Group and CYIOS.

Diversification Opportunities for Cosmos Group and CYIOS

0.31

Correlation Coefficient

Cosmos Group  CYIOS

Weak diversification

The 3 months correlation between Cosmos and CYIOS is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Cosmos Group Holdings and CYIOS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CYIOS and Cosmos Group 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 Cosmos Group Holdings are associated (or correlated) with CYIOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CYIOS has no effect on the direction of Cosmos Group i.e., Cosmos Group and CYIOS go up and down completely randomly.

Pair Corralation between Cosmos Group and CYIOS

Given the investment horizon of 90 days Cosmos Group Holdings is expected to generate 31.75 times more return on investment than CYIOS. However, Cosmos Group is 31.75 times more volatile than CYIOS. It trades about 0.22 of its potential returns per unit of risk. CYIOS is currently generating about -0.06 per unit of risk. If you would invest  0.01  in Cosmos Group Holdings on September 4, 2024 and sell it today you would lose (0.01) from holding Cosmos Group Holdings or give up 100.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Cosmos Group Holdings  vs.  CYIOS

Cosmos Group Holdings

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cosmos Group Holdings are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Cosmos Group reported solid returns over the last few months and may actually be approaching a breakup point.

CYIOS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CYIOS 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 forward indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Cosmos Group and CYIOS

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

The idea behind Cosmos Group Holdings and CYIOS 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.