Correlation Between Carlsberg and CSSC Offshore
Can any of the company-specific risk be diversified away by investing in both Carlsberg and CSSC Offshore 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 Carlsberg and CSSC Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlsberg AS and CSSC Offshore Marine, you can compare the effects of market volatilities on Carlsberg and CSSC Offshore 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 Carlsberg with a short position of CSSC Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlsberg and CSSC Offshore.
Diversification Opportunities for Carlsberg and CSSC Offshore
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Carlsberg and CSSC is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Carlsberg AS and CSSC Offshore Marine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSSC Offshore Marine and Carlsberg 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 Carlsberg AS are associated (or correlated) with CSSC Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSSC Offshore Marine has no effect on the direction of Carlsberg i.e., Carlsberg and CSSC Offshore go up and down completely randomly.
Pair Corralation between Carlsberg and CSSC Offshore
Assuming the 90 days trading horizon Carlsberg is expected to generate 2.31 times less return on investment than CSSC Offshore. But when comparing it to its historical volatility, Carlsberg AS is 1.55 times less risky than CSSC Offshore. It trades about 0.03 of its potential returns per unit of risk. CSSC Offshore Marine is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 78.00 in CSSC Offshore Marine on September 13, 2024 and sell it today you would earn a total of 51.00 from holding CSSC Offshore Marine or generate 65.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Carlsberg AS vs. CSSC Offshore Marine
Performance |
| Timeline |
| Carlsberg AS |
| CSSC Offshore Marine |
Carlsberg and CSSC Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlsberg and CSSC Offshore
The main advantage of trading using opposite Carlsberg and CSSC Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlsberg position performs unexpectedly, CSSC Offshore 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 CSSC Offshore will offset losses from the drop in CSSC Offshore's long position.| Carlsberg vs. SHIP HEALTHCARE HLDGINC | Carlsberg vs. EHEALTH | Carlsberg vs. Sims Metal Management | Carlsberg vs. Sabra Health Care |
| CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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