Correlation Between CSSC Offshore and Bausch Health
Can any of the company-specific risk be diversified away by investing in both CSSC Offshore and Bausch Health 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 Bausch Health 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 Bausch Health Companies, you can compare the effects of market volatilities on CSSC Offshore and Bausch Health 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 Bausch Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSSC Offshore and Bausch Health.
Diversification Opportunities for CSSC Offshore and Bausch Health
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CSSC and Bausch is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and Bausch Health Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bausch Health Companies 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 Bausch Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bausch Health Companies has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and Bausch Health go up and down completely randomly.
Pair Corralation between CSSC Offshore and Bausch Health
Assuming the 90 days trading horizon CSSC Offshore Marine is expected to generate 0.83 times more return on investment than Bausch Health. However, CSSC Offshore Marine is 1.2 times less risky than Bausch Health. It trades about 0.04 of its potential returns per unit of risk. Bausch Health Companies is currently generating about 0.02 per unit of risk. If you would invest 79.00 in CSSC Offshore Marine on October 15, 2024 and sell it today you would earn a total of 44.00 from holding CSSC Offshore Marine or generate 55.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSSC Offshore Marine vs. Bausch Health Companies
Performance |
| Timeline |
| CSSC Offshore Marine |
| Bausch Health Companies |
CSSC Offshore and Bausch Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSSC Offshore and Bausch Health
The main advantage of trading using opposite CSSC Offshore and Bausch Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSSC Offshore position performs unexpectedly, Bausch Health 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 Bausch Health will offset losses from the drop in Bausch Health's long position.| CSSC Offshore vs. DFS Furniture PLC | CSSC Offshore vs. STMicroelectronics NV | CSSC Offshore vs. Meiko Electronics Co | CSSC Offshore vs. CAIRN HOMES EO |
| Bausch Health vs. CSSC Offshore Marine | Bausch Health vs. Molson Coors Beverage | Bausch Health vs. PT Wintermar Offshore | Bausch Health vs. SBM OFFSHORE |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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