Correlation Between CSSC Offshore and VITEC SOFTWARE

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Can any of the company-specific risk be diversified away by investing in both CSSC Offshore and VITEC SOFTWARE 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 VITEC SOFTWARE 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 VITEC SOFTWARE GROUP, you can compare the effects of market volatilities on CSSC Offshore and VITEC SOFTWARE 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 VITEC SOFTWARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSSC Offshore and VITEC SOFTWARE.

Diversification Opportunities for CSSC Offshore and VITEC SOFTWARE

CSSCVITECDiversified AwayCSSCVITECDiversified Away100%
0.11
  Correlation Coefficient

Average diversification

The 3 months correlation between CSSC and VITEC is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and VITEC SOFTWARE GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VITEC SOFTWARE GROUP 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 VITEC SOFTWARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VITEC SOFTWARE GROUP has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and VITEC SOFTWARE go up and down completely randomly.

Pair Corralation between CSSC Offshore and VITEC SOFTWARE

Assuming the 90 days trading horizon CSSC Offshore Marine is expected to under-perform the VITEC SOFTWARE. In addition to that, CSSC Offshore is 1.4 times more volatile than VITEC SOFTWARE GROUP. It trades about -0.03 of its total potential returns per unit of risk. VITEC SOFTWARE GROUP is currently generating about 0.02 per unit of volatility. If you would invest  4,593  in VITEC SOFTWARE GROUP on September 29, 2024 and sell it today you would earn a total of  43.00  from holding VITEC SOFTWARE GROUP or generate 0.94% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

CSSC Offshore Marine  vs.  VITEC SOFTWARE GROUP

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -1001020
JavaScript chart by amCharts 3.21.15GSZ 7VS
       Timeline  
CSSC Offshore Marine 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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 comparatively stable basic indicators, CSSC Offshore is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec1.21.31.41.51.61.7
VITEC SOFTWARE GROUP 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in VITEC SOFTWARE GROUP are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, VITEC SOFTWARE is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec383940414243444546

CSSC Offshore and VITEC SOFTWARE Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-9.91-7.43-4.94-2.450.02.444.967.4810.012.52 0.020.040.060.08
JavaScript chart by amCharts 3.21.15GSZ 7VS
       Returns  

Pair Trading with CSSC Offshore and VITEC SOFTWARE

The main advantage of trading using opposite CSSC Offshore and VITEC SOFTWARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSSC Offshore position performs unexpectedly, VITEC SOFTWARE 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 VITEC SOFTWARE will offset losses from the drop in VITEC SOFTWARE's long position.
The idea behind CSSC Offshore Marine and VITEC SOFTWARE GROUP 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.

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