Correlation Between CosmoSteel Holdings and Fastenal

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

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

Diversification Opportunities for CosmoSteel Holdings and Fastenal

0.55

Correlation Coefficient

CosmoSteel Holdings  Fastenal

Very weak diversification

The 3 months correlation between CosmoSteel and Fastenal is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding CosmoSteel Holdings Limited and Fastenal Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fastenal and CosmoSteel Holdings 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 CosmoSteel Holdings Limited are associated (or correlated) with Fastenal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fastenal has no effect on the direction of CosmoSteel Holdings i.e., CosmoSteel Holdings and Fastenal go up and down completely randomly.

Pair Corralation between CosmoSteel Holdings and Fastenal

Assuming the 90 days horizon CosmoSteel Holdings is expected to generate 1.14 times less return on investment than Fastenal. In addition to that, CosmoSteel Holdings is 2.04 times more volatile than Fastenal Company. It trades about 0.1 of its total potential returns per unit of risk. Fastenal Company is currently generating about 0.23 per unit of volatility. If you would invest  3,572  in Fastenal Company on May 26, 2025 and sell it today you would earn a total of  666.00  from holding Fastenal Company or generate 18.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.48%
Values	Daily Returns

CosmoSteel Holdings Limited  vs.  Fastenal Company

CosmoSteel Holdings

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in CosmoSteel Holdings Limited are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CosmoSteel Holdings reported solid returns over the last few months and may actually be approaching a breakup point.

Fastenal

Risk-Adjusted Performance

Solid

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

Pair Trading with CosmoSteel Holdings and Fastenal

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

The idea behind CosmoSteel Holdings Limited and Fastenal Company 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.