Correlation Between CSSC Offshore and China DatangRenewable
Can any of the company-specific risk be diversified away by investing in both CSSC Offshore and China DatangRenewable 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 China DatangRenewable 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 China Datang, you can compare the effects of market volatilities on CSSC Offshore and China DatangRenewable 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 China DatangRenewable. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSSC Offshore and China DatangRenewable.
Diversification Opportunities for CSSC Offshore and China DatangRenewable
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between CSSC and China is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and China Datang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China DatangRenewable 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 China DatangRenewable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China DatangRenewable has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and China DatangRenewable go up and down completely randomly.
Pair Corralation between CSSC Offshore and China DatangRenewable
Assuming the 90 days trading horizon CSSC Offshore Marine is expected to under-perform the China DatangRenewable. But the stock apears to be less risky and, when comparing its historical volatility, CSSC Offshore Marine is 2.9 times less risky than China DatangRenewable. The stock trades about -0.22 of its potential returns per unit of risk. The China Datang is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 24.00 in China Datang on November 4, 2024 and sell it today you would earn a total of 1.00 from holding China Datang or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
CSSC Offshore Marine vs. China Datang
Performance |
| Timeline |
| CSSC Offshore Marine |
| China DatangRenewable |
CSSC Offshore and China DatangRenewable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSSC Offshore and China DatangRenewable
The main advantage of trading using opposite CSSC Offshore and China DatangRenewable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSSC Offshore position performs unexpectedly, China DatangRenewable 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 China DatangRenewable will offset losses from the drop in China DatangRenewable's long position.| CSSC Offshore vs. WT OFFSHORE | CSSC Offshore vs. MGIC INVESTMENT | CSSC Offshore vs. NAKED WINES PLC | CSSC Offshore vs. VIRGIN WINES UK |
| China DatangRenewable vs. ACCSYS TECHPLC EO | China DatangRenewable vs. COLUMBIA SPORTSWEAR | China DatangRenewable vs. Playtech plc | China DatangRenewable vs. PLAYSTUDIOS A DL 0001 |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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