Correlation Between SHIP HEALTHCARE and CSL

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

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

Diversification Opportunities for SHIP HEALTHCARE and CSL

0.23

Correlation Coefficient

SHIP HEALTHCARE  CSL

Modest diversification

The 3 months correlation between SHIP and CSL is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding SHIP HEALTHCARE HLDGINC and CSL LTD SPONADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSL LTD SPONADR and SHIP HEALTHCARE 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 SHIP HEALTHCARE HLDGINC are associated (or correlated) with CSL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSL LTD SPONADR has no effect on the direction of SHIP HEALTHCARE i.e., SHIP HEALTHCARE and CSL go up and down completely randomly.

Pair Corralation between SHIP HEALTHCARE and CSL

Assuming the 90 days horizon SHIP HEALTHCARE HLDGINC is expected to generate 0.6 times more return on investment than CSL. However, SHIP HEALTHCARE HLDGINC is 1.66 times less risky than CSL. It trades about 0.19 of its potential returns per unit of risk. CSL LTD SPONADR is currently generating about -0.09 per unit of risk. If you would invest  1,090  in SHIP HEALTHCARE HLDGINC on May 26, 2025 and sell it today you would earn a total of  200.00  from holding SHIP HEALTHCARE HLDGINC or generate 18.35% return on investment over 90 days.

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

SHIP HEALTHCARE HLDGINC  vs.  CSL LTD SPONADR

SHIP HEALTHCARE HLDGINC

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SHIP HEALTHCARE HLDGINC are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SHIP HEALTHCARE reported solid returns over the last few months and may actually be approaching a breakup point.

CSL LTD SPONADR

Risk-Adjusted Performance

Weakest

Over the last 90 days CSL LTD SPONADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's forward-looking indicators remain nearly stable which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with SHIP HEALTHCARE and CSL

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

The idea behind SHIP HEALTHCARE HLDGINC and CSL LTD SPONADR 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.