Correlation Between CSSC Offshore and SENECA FOODS-A

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

Diversification Opportunities for CSSC Offshore and SENECA FOODS-A

0.58

Correlation Coefficient

CSSC Offshore  SENECA FOODS-A

Very weak diversification

The 3 months correlation between CSSC and SENECA is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and SENECA FOODS A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SENECA FOODS A 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 SENECA FOODS-A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SENECA FOODS A has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and SENECA FOODS-A go up and down completely randomly.

Pair Corralation between CSSC Offshore and SENECA FOODS-A

Assuming the 90 days trading horizon CSSC Offshore is expected to generate 27.02 times less return on investment than SENECA FOODS-A. But when comparing it to its historical volatility, CSSC Offshore Marine is 19.8 times less risky than SENECA FOODS-A. It trades about 0.13 of its potential returns per unit of risk. SENECA FOODS A is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  6,950  in SENECA FOODS A on April 21, 2025 and sell it today you would earn a total of  1,650  from holding SENECA FOODS A or generate 23.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

CSSC Offshore Marine  vs.  SENECA FOODS A

CSSC Offshore Marine

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CSSC Offshore Marine are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. 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.

SENECA FOODS A

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SENECA FOODS A are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, SENECA FOODS-A exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CSSC Offshore and SENECA FOODS-A

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

The idea behind CSSC Offshore Marine and SENECA FOODS A 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.

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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.