Correlation Between CSPC Pharmaceutical and Eisai

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

By analyzing existing cross correlation between CSPC Pharmaceutical Group and Eisai Co, you can compare the effects of market volatilities on CSPC Pharmaceutical and Eisai 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 CSPC Pharmaceutical with a short position of Eisai. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSPC Pharmaceutical and Eisai.

Diversification Opportunities for CSPC Pharmaceutical and Eisai

0.3

Correlation Coefficient

CSPC Pharmaceutical  Eisai

Weak diversification

The 3 months correlation between CSPC and Eisai is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding CSPC Pharmaceutical Group and Eisai Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eisai and CSPC Pharmaceutical 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 CSPC Pharmaceutical Group are associated (or correlated) with Eisai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eisai has no effect on the direction of CSPC Pharmaceutical i.e., CSPC Pharmaceutical and Eisai go up and down completely randomly.

Pair Corralation between CSPC Pharmaceutical and Eisai

If you would invest  127.00  in CSPC Pharmaceutical Group on July 28, 2025 and sell it today you would earn a total of  0.00  from holding CSPC Pharmaceutical Group or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.55%
Values	Daily Returns

CSPC Pharmaceutical Group  vs.  Eisai Co

CSPC Pharmaceutical

Risk-Adjusted Performance

Solid

Over the last 90 days CSPC Pharmaceutical Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly fragile basic indicators, CSPC Pharmaceutical reported solid returns over the last few months and may actually be approaching a breakup point.

Eisai

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Eisai Co are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile forward indicators, Eisai may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Pair Trading with CSPC Pharmaceutical and Eisai

The main advantage of trading using opposite CSPC Pharmaceutical and Eisai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSPC Pharmaceutical position performs unexpectedly, Eisai 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 Eisai will offset losses from the drop in Eisai's long position.

The idea behind CSPC Pharmaceutical Group and Eisai Co 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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .