Correlation Between CSL and Materialise

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

By analyzing existing cross correlation between CSL Limited and Materialise NV, you can compare the effects of market volatilities on CSL and Materialise 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 CSL with a short position of Materialise. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSL and Materialise.

Diversification Opportunities for CSL and Materialise

0.07

Correlation Coefficient

CSL  Materialise

Significant diversification

The 3 months correlation between CSL and Materialise is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding CSL Limited and Materialise NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materialise NV and CSL 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 CSL Limited are associated (or correlated) with Materialise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materialise NV has no effect on the direction of CSL i.e., CSL and Materialise go up and down completely randomly.

Pair Corralation between CSL and Materialise

Assuming the 90 days horizon CSL is expected to generate 1.12 times less return on investment than Materialise. In addition to that, CSL is 1.0 times more volatile than Materialise NV. It trades about 0.21 of its total potential returns per unit of risk. Materialise NV is currently generating about 0.23 per unit of volatility. If you would invest  462.00  in Materialise NV on April 21, 2025 and sell it today you would earn a total of  38.00  from holding Materialise NV or generate 8.23% return on investment over 90 days.

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

CSL Limited  vs.  Materialise NV

CSL Limited

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CSL Limited are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CSL may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Materialise NV

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Materialise NV are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Materialise unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CSL and Materialise

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

The idea behind CSL Limited and Materialise NV 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.