Correlation Between CSX and Schneider National

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

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

Diversification Opportunities for CSX and Schneider National

0.65

Correlation Coefficient

CSX  Schneider National

Poor diversification

The 3 months correlation between CSX and Schneider is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding CSX Corp. and Schneider National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schneider National and CSX 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 CSX Corporation are associated (or correlated) with Schneider National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schneider National has no effect on the direction of CSX i.e., CSX and Schneider National go up and down completely randomly.

Pair Corralation between CSX and Schneider National

Considering the 90-day investment horizon CSX Corporation is expected to generate 0.71 times more return on investment than Schneider National. However, CSX Corporation is 1.4 times less risky than Schneider National. It trades about 0.19 of its potential returns per unit of risk. Schneider National is currently generating about 0.01 per unit of risk. If you would invest  3,090  in CSX Corporation on May 14, 2025 and sell it today you would earn a total of  433.00  from holding CSX Corporation or generate 14.01% return on investment over 90 days.

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

CSX Corp.  vs.  Schneider National

CSX Corporation

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CSX Corporation are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, CSX showed solid returns over the last few months and may actually be approaching a breakup point.

Schneider National

Risk-Adjusted Performance

Weakest

Over the last 90 days Schneider National has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental indicators, Schneider National is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with CSX and Schneider National

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

The idea behind CSX Corporation and Schneider National 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.