Correlation Between CSSC Offshore and Shandong Homey
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By analyzing existing cross correlation between CSSC Offshore Marine and Shandong Homey Aquatic, you can compare the effects of market volatilities on CSSC Offshore and Shandong Homey 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 CSSC Offshore with a short position of Shandong Homey. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSSC Offshore and Shandong Homey.
Diversification Opportunities for CSSC Offshore and Shandong Homey
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CSSC and Shandong is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and Shandong Homey Aquatic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Homey Aquatic and CSSC Offshore 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 CSSC Offshore Marine are associated (or correlated) with Shandong Homey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Homey Aquatic has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and Shandong Homey go up and down completely randomly.
Pair Corralation between CSSC Offshore and Shandong Homey
Assuming the 90 days trading horizon CSSC Offshore Marine is expected to generate 0.79 times more return on investment than Shandong Homey. However, CSSC Offshore Marine is 1.27 times less risky than Shandong Homey. It trades about 0.02 of its potential returns per unit of risk. Shandong Homey Aquatic is currently generating about 0.01 per unit of risk. If you would invest 2,272 in CSSC Offshore Marine on August 25, 2024 and sell it today you would earn a total of 189.00 from holding CSSC Offshore Marine or generate 8.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSSC Offshore Marine vs. Shandong Homey Aquatic
Performance |
| Timeline |
| CSSC Offshore Marine |
| Shandong Homey Aquatic |
CSSC Offshore and Shandong Homey Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSSC Offshore and Shandong Homey
The main advantage of trading using opposite CSSC Offshore and Shandong Homey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSSC Offshore position performs unexpectedly, Shandong Homey 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 Shandong Homey will offset losses from the drop in Shandong Homey's long position.| CSSC Offshore vs. Jiangyin Jianghua Microelectronics | CSSC Offshore vs. Fuzhou Rockchip Electronics | CSSC Offshore vs. Kunshan Guoli Electronic | CSSC Offshore vs. Bomin Electronics Co |
| Shandong Homey vs. China Petroleum Chemical | Shandong Homey vs. PetroChina Co Ltd | Shandong Homey vs. China State Construction | Shandong Homey vs. China Railway Group |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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