Correlation Between CSW Industrials, and INLIF LIMITED

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

By analyzing existing cross correlation between CSW Industrials, and INLIF LIMITED Ordinary, you can compare the effects of market volatilities on CSW Industrials, and INLIF LIMITED 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 CSW Industrials, with a short position of INLIF LIMITED. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSW Industrials, and INLIF LIMITED.

Diversification Opportunities for CSW Industrials, and INLIF LIMITED

0.67

Correlation Coefficient

CSW Industrials,  INLIF LIMITED

Poor diversification

The 3 months correlation between CSW and INLIF is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding CSW Industrials, and INLIF LIMITED Ordinary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INLIF LIMITED Ordinary and CSW Industrials, 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 CSW Industrials, are associated (or correlated) with INLIF LIMITED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INLIF LIMITED Ordinary has no effect on the direction of CSW Industrials, i.e., CSW Industrials, and INLIF LIMITED go up and down completely randomly.

Pair Corralation between CSW Industrials, and INLIF LIMITED

Considering the 90-day investment horizon CSW Industrials, is expected to under-perform the INLIF LIMITED. But the stock apears to be less risky and, when comparing its historical volatility, CSW Industrials, is 4.07 times less risky than INLIF LIMITED. The stock trades about -0.07 of its potential returns per unit of risk. The INLIF LIMITED Ordinary is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  125.00  in INLIF LIMITED Ordinary on April 30, 2025 and sell it today you would lose (22.00) from holding INLIF LIMITED Ordinary or give up 17.6% of portfolio value over 90 days.

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

CSW Industrials,  vs.  INLIF LIMITED Ordinary

CSW Industrials,

Risk-Adjusted Performance

Very Weak

Over the last 90 days CSW Industrials, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

INLIF LIMITED Ordinary

Risk-Adjusted Performance

Weak

Over the last 90 days INLIF LIMITED Ordinary has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, INLIF LIMITED is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with CSW Industrials, and INLIF LIMITED

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

The idea behind CSW Industrials, and INLIF LIMITED Ordinary 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.