Correlation Between Safety Insurance and CSSC Offshore
Can any of the company-specific risk be diversified away by investing in both Safety Insurance 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 Safety Insurance and CSSC Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safety Insurance Group and CSSC Offshore Marine, you can compare the effects of market volatilities on Safety Insurance 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 Safety Insurance with a short position of CSSC Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safety Insurance and CSSC Offshore.
Diversification Opportunities for Safety Insurance and CSSC Offshore
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Safety and CSSC is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Safety Insurance Group 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 Safety Insurance 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 Safety Insurance Group 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 Safety Insurance i.e., Safety Insurance and CSSC Offshore go up and down completely randomly.
Pair Corralation between Safety Insurance and CSSC Offshore
Assuming the 90 days horizon Safety Insurance Group is expected to generate 0.44 times more return on investment than CSSC Offshore. However, Safety Insurance Group is 2.25 times less risky than CSSC Offshore. It trades about 0.05 of its potential returns per unit of risk. CSSC Offshore Marine is currently generating about 0.01 per unit of risk. If you would invest 7,270 in Safety Insurance Group on September 3, 2024 and sell it today you would earn a total of 730.00 from holding Safety Insurance Group or generate 10.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Safety Insurance Group vs. CSSC Offshore Marine
Performance |
| Timeline |
| Safety Insurance |
| CSSC Offshore Marine |
Safety Insurance and CSSC Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safety Insurance and CSSC Offshore
The main advantage of trading using opposite Safety Insurance and CSSC Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safety Insurance 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.| Safety Insurance vs. Sims Metal Management | Safety Insurance vs. Flutter Entertainment PLC | Safety Insurance vs. TOWNSQUARE MEDIA INC | Safety Insurance vs. RCS MediaGroup SpA |
| 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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