Correlation Between COSMO Pharmaceuticals and Chocoladefabriken

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

By analyzing existing cross correlation between COSMO Pharmaceuticals SA and Chocoladefabriken Lindt Spruengli, you can compare the effects of market volatilities on COSMO Pharmaceuticals and Chocoladefabriken 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 COSMO Pharmaceuticals with a short position of Chocoladefabriken. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSMO Pharmaceuticals and Chocoladefabriken.

Diversification Opportunities for COSMO Pharmaceuticals and Chocoladefabriken

0.58

Correlation Coefficient

COSMO Pharmaceuticals  Chocoladefabriken

Very weak diversification

The 3 months correlation between COSMO and Chocoladefabriken is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding COSMO Pharmaceuticals SA and Chocoladefabriken Lindt Spruen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chocoladefabriken Lindt and COSMO Pharmaceuticals 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 COSMO Pharmaceuticals SA are associated (or correlated) with Chocoladefabriken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chocoladefabriken Lindt has no effect on the direction of COSMO Pharmaceuticals i.e., COSMO Pharmaceuticals and Chocoladefabriken go up and down completely randomly.

Pair Corralation between COSMO Pharmaceuticals and Chocoladefabriken

Assuming the 90 days trading horizon COSMO Pharmaceuticals SA is expected to generate 1.54 times more return on investment than Chocoladefabriken. However, COSMO Pharmaceuticals is 1.54 times more volatile than Chocoladefabriken Lindt Spruengli. It trades about 0.12 of its potential returns per unit of risk. Chocoladefabriken Lindt Spruengli is currently generating about 0.1 per unit of risk. If you would invest  5,740  in COSMO Pharmaceuticals SA on August 19, 2025 and sell it today you would earn a total of  770.00  from holding COSMO Pharmaceuticals SA or generate 13.41% return on investment over 90 days.

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

COSMO Pharmaceuticals SA  vs.  Chocoladefabriken Lindt Spruen

COSMO Pharmaceuticals

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in COSMO Pharmaceuticals SA are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, COSMO Pharmaceuticals showed solid returns over the last few months and may actually be approaching a breakup point.

Chocoladefabriken Lindt

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Chocoladefabriken Lindt Spruengli are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Chocoladefabriken may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Pair Trading with COSMO Pharmaceuticals and Chocoladefabriken

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

The idea behind COSMO Pharmaceuticals SA and Chocoladefabriken Lindt Spruengli 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.