Correlation Between CSSC Offshore and ASTRA INTERNATIONAL
Can any of the company-specific risk be diversified away by investing in both CSSC Offshore and ASTRA INTERNATIONAL 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 CSSC Offshore and ASTRA INTERNATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSSC Offshore Marine and ASTRA INTERNATIONAL, you can compare the effects of market volatilities on CSSC Offshore and ASTRA INTERNATIONAL 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 ASTRA INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSSC Offshore and ASTRA INTERNATIONAL.
Diversification Opportunities for CSSC Offshore and ASTRA INTERNATIONAL
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CSSC and ASTRA is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL 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 ASTRA INTERNATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASTRA INTERNATIONAL has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and ASTRA INTERNATIONAL go up and down completely randomly.
Pair Corralation between CSSC Offshore and ASTRA INTERNATIONAL
Assuming the 90 days trading horizon CSSC Offshore Marine is expected to generate 1.61 times more return on investment than ASTRA INTERNATIONAL. However, CSSC Offshore is 1.61 times more volatile than ASTRA INTERNATIONAL. It trades about 0.02 of its potential returns per unit of risk. ASTRA INTERNATIONAL is currently generating about -0.02 per unit of risk. If you would invest 118.00 in CSSC Offshore Marine on September 12, 2024 and sell it today you would earn a total of 7.00 from holding CSSC Offshore Marine or generate 5.93% 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. ASTRA INTERNATIONAL
Performance |
| Timeline |
| CSSC Offshore Marine |
| ASTRA INTERNATIONAL |
CSSC Offshore and ASTRA INTERNATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSSC Offshore and ASTRA INTERNATIONAL
The main advantage of trading using opposite CSSC Offshore and ASTRA INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSSC Offshore position performs unexpectedly, ASTRA INTERNATIONAL 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 ASTRA INTERNATIONAL will offset losses from the drop in ASTRA INTERNATIONAL's long position.| CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc |
| ASTRA INTERNATIONAL vs. Gold Road Resources | ASTRA INTERNATIONAL vs. Eidesvik Offshore ASA | ASTRA INTERNATIONAL vs. EIDESVIK OFFSHORE NK | ASTRA INTERNATIONAL vs. CSSC Offshore Marine |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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