Correlation Between Xiwang Special and CSSC Offshore

Can any of the company-specific risk be diversified away by investing in both Xiwang Special 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 Xiwang Special and CSSC Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Xiwang Special Steel and CSSC Offshore Marine, you can compare the effects of market volatilities on Xiwang Special 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 Xiwang Special with a short position of CSSC Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiwang Special and CSSC Offshore.

Diversification Opportunities for Xiwang Special and CSSC Offshore

0.0

Correlation Coefficient

Xiwang Special  CSSC Offshore

Pay attention - limited upside

The 3 months correlation between Xiwang and CSSC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Xiwang Special Steel 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 Xiwang Special 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 Xiwang Special Steel 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 Xiwang Special i.e., Xiwang Special and CSSC Offshore go up and down completely randomly.

Pair Corralation between Xiwang Special and CSSC Offshore

If you would invest  0.01  in Xiwang Special Steel on December 20, 2024 and sell it today you would earn a total of  0.00  from holding Xiwang Special Steel or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Xiwang Special Steel  vs.  CSSC Offshore Marine

Xiwang Special Steel

Risk-Adjusted Performance

Very Weak

Over the last 90 days Xiwang Special Steel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Xiwang Special is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

CSSC Offshore Marine

Risk-Adjusted Performance

Very Weak

Over the last 90 days CSSC Offshore Marine has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Xiwang Special and CSSC Offshore

The main advantage of trading using opposite Xiwang Special and CSSC Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiwang Special 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.

The idea behind Xiwang Special Steel and CSSC Offshore Marine pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.