Correlation Between CSSC Offshore and TRAVEL LEISURE
Can any of the company-specific risk be diversified away by investing in both CSSC Offshore and TRAVEL LEISURE 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 TRAVEL LEISURE 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 TRAVEL LEISURE DL 01, you can compare the effects of market volatilities on CSSC Offshore and TRAVEL LEISURE 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 TRAVEL LEISURE. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSSC Offshore and TRAVEL LEISURE.
Diversification Opportunities for CSSC Offshore and TRAVEL LEISURE
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CSSC and TRAVEL is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and TRAVEL LEISURE DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRAVEL LEISURE DL 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 TRAVEL LEISURE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRAVEL LEISURE DL has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and TRAVEL LEISURE go up and down completely randomly.
Pair Corralation between CSSC Offshore and TRAVEL LEISURE
Assuming the 90 days trading horizon CSSC Offshore Marine is expected to under-perform the TRAVEL LEISURE. In addition to that, CSSC Offshore is 2.06 times more volatile than TRAVEL LEISURE DL 01. It trades about -0.13 of its total potential returns per unit of risk. TRAVEL LEISURE DL 01 is currently generating about 0.04 per unit of volatility. If you would invest 5,050 in TRAVEL LEISURE DL 01 on September 13, 2024 and sell it today you would earn a total of 50.00 from holding TRAVEL LEISURE DL 01 or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSSC Offshore Marine vs. TRAVEL LEISURE DL 01
Performance |
| Timeline |
| CSSC Offshore Marine |
| TRAVEL LEISURE DL |
CSSC Offshore and TRAVEL LEISURE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSSC Offshore and TRAVEL LEISURE
The main advantage of trading using opposite CSSC Offshore and TRAVEL LEISURE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSSC Offshore position performs unexpectedly, TRAVEL LEISURE 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 TRAVEL LEISURE will offset losses from the drop in TRAVEL LEISURE's long position.| CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc | CSSC Offshore vs. Apple Inc |
| TRAVEL LEISURE vs. ACCSYS TECHPLC EO | TRAVEL LEISURE vs. Hanison Construction Holdings | TRAVEL LEISURE vs. Hitachi Construction Machinery | TRAVEL LEISURE vs. TITAN MACHINERY |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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