Correlation Between USD Partners and CSX
Can any of the company-specific risk be diversified away by investing in both USD Partners and CSX 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 USD Partners and CSX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USD Partners LP and CSX Corporation, you can compare the effects of market volatilities on USD Partners and CSX 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 USD Partners with a short position of CSX. Check out your portfolio center. Please also check ongoing floating volatility patterns of USD Partners and CSX.
Diversification Opportunities for USD Partners and CSX
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between USD and CSX is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding USD Partners LP and CSX Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSX Corporation and USD Partners 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 USD Partners LP are associated (or correlated) with CSX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSX Corporation has no effect on the direction of USD Partners i.e., USD Partners and CSX go up and down completely randomly.
Pair Corralation between USD Partners and CSX
If you would invest 3,353 in CSX Corporation on September 1, 2024 and sell it today you would earn a total of 302.00 from holding CSX Corporation or generate 9.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
USD Partners LP vs. CSX Corp.
Performance |
| Timeline |
| USD Partners LP |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| CSX Corporation |
USD Partners and CSX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USD Partners and CSX
The main advantage of trading using opposite USD Partners and CSX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USD Partners position performs unexpectedly, CSX 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 CSX will offset losses from the drop in CSX's long position.| USD Partners vs. Greenbrier Companies | USD Partners vs. LB Foster | USD Partners vs. Freightcar America | USD Partners vs. Westinghouse Air Brake |
| CSX vs. Union Pacific | CSX vs. Canadian National Railway | CSX vs. Canadian Pacific Railway | CSX vs. Westinghouse Air Brake |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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