Correlation Between CSSC Offshore and CHINA SOUTHN

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

Diversification Opportunities for CSSC Offshore and CHINA SOUTHN

0.48

Correlation Coefficient

CSSC Offshore  CHINA SOUTHN

Very weak diversification

The 3 months correlation between CSSC and CHINA is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and CHINA SOUTHN AIR H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA SOUTHN AIR 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 CHINA SOUTHN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA SOUTHN AIR has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and CHINA SOUTHN go up and down completely randomly.

Pair Corralation between CSSC Offshore and CHINA SOUTHN

Assuming the 90 days trading horizon CSSC Offshore is expected to generate 11.52 times less return on investment than CHINA SOUTHN. But when comparing it to its historical volatility, CSSC Offshore Marine is 22.55 times less risky than CHINA SOUTHN. It trades about 0.13 of its potential returns per unit of risk. CHINA SOUTHN AIR H is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  37.00  in CHINA SOUTHN AIR H on April 23, 2025 and sell it today you would earn a total of  3.00  from holding CHINA SOUTHN AIR H or generate 8.11% return on investment over 90 days.

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

CSSC Offshore Marine  vs.  CHINA SOUTHN AIR H

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 current stock price uproar, may contribute to short-horizon losses for the private investors.

CHINA SOUTHN AIR

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CHINA SOUTHN AIR H are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, CHINA SOUTHN may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with CSSC Offshore and CHINA SOUTHN

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

The idea behind CSSC Offshore Marine and CHINA SOUTHN AIR H 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.