Correlation Between Magic Software and CSSC Offshore
Can any of the company-specific risk be diversified away by investing in both Magic Software 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 Magic Software and CSSC Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magic Software Enterprises and CSSC Offshore Marine, you can compare the effects of market volatilities on Magic Software 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 Magic Software with a short position of CSSC Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magic Software and CSSC Offshore.
Diversification Opportunities for Magic Software and CSSC Offshore
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Magic and CSSC is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Magic Software Enterprises 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 Magic Software 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 Magic Software Enterprises 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 Magic Software i.e., Magic Software and CSSC Offshore go up and down completely randomly.
Pair Corralation between Magic Software and CSSC Offshore
Assuming the 90 days horizon Magic Software is expected to generate 24.88 times less return on investment than CSSC Offshore. But when comparing it to its historical volatility, Magic Software Enterprises is 1.03 times less risky than CSSC Offshore. It trades about 0.0 of its potential returns per unit of risk. CSSC Offshore Marine is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 82.00 in CSSC Offshore Marine on September 3, 2024 and sell it today you would earn a total of 42.00 from holding CSSC Offshore Marine or generate 51.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Magic Software Enterprises vs. CSSC Offshore Marine
Performance |
| Timeline |
| Magic Software Enter |
| CSSC Offshore Marine |
Magic Software and CSSC Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magic Software and CSSC Offshore
The main advantage of trading using opposite Magic Software and CSSC Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magic Software 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.| Magic Software vs. Superior Plus Corp | Magic Software vs. NMI Holdings | Magic Software vs. Origin Agritech | Magic Software vs. SIVERS SEMICONDUCTORS AB |
| CSSC Offshore vs. SBA Communications Corp | CSSC Offshore vs. FIREWEED METALS P | CSSC Offshore vs. Jacquet Metal Service | CSSC Offshore vs. Shenandoah Telecommunications |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |