Correlation Between Global Ship and Information Services
Can any of the company-specific risk be diversified away by investing in both Global Ship and Information Services 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 Global Ship and Information Services into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Ship Lease and Information Services International Dentsu, you can compare the effects of market volatilities on Global Ship and Information Services 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 Global Ship with a short position of Information Services. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and Information Services.
Diversification Opportunities for Global Ship and Information Services
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Information is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and Information Services Internati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Information Services and Global Ship 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 Global Ship Lease are associated (or correlated) with Information Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Information Services has no effect on the direction of Global Ship i.e., Global Ship and Information Services go up and down completely randomly.
Pair Corralation between Global Ship and Information Services
Assuming the 90 days horizon Global Ship Lease is expected to generate 0.91 times more return on investment than Information Services. However, Global Ship Lease is 1.09 times less risky than Information Services. It trades about 0.05 of its potential returns per unit of risk. Information Services International Dentsu is currently generating about 0.02 per unit of risk. If you would invest 1,724 in Global Ship Lease on November 9, 2024 and sell it today you would earn a total of 344.00 from holding Global Ship Lease or generate 19.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Ship Lease vs. Information Services Internati
Performance |
| Timeline |
| Global Ship Lease |
| Information Services |
Global Ship and Information Services Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ship and Information Services
The main advantage of trading using opposite Global Ship and Information Services positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ship position performs unexpectedly, Information Services 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 Information Services will offset losses from the drop in Information Services' long position.| Global Ship vs. UNITED RENTALS | Global Ship vs. Performance Food Group | Global Ship vs. PATTIES FOODS | Global Ship vs. FUYO GENERAL LEASE |
| Information Services vs. Easy Software AG | Information Services vs. Harmony Gold Mining | Information Services vs. ADRIATIC METALS LS 013355 | Information Services vs. GREENX METALS LTD |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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