Correlation Between Global Ship and News
Can any of the company-specific risk be diversified away by investing in both Global Ship and News 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 News 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 News Corporation, you can compare the effects of market volatilities on Global Ship and News 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 News. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and News.
Diversification Opportunities for Global Ship and News
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and News is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and News Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on News 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 News. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of News has no effect on the direction of Global Ship i.e., Global Ship and News go up and down completely randomly.
Pair Corralation between Global Ship and News
Assuming the 90 days horizon Global Ship Lease is expected to under-perform the News. In addition to that, Global Ship is 1.27 times more volatile than News Corporation. It trades about -0.08 of its total potential returns per unit of risk. News Corporation is currently generating about 0.1 per unit of volatility. If you would invest 2,530 in News Corporation on September 12, 2024 and sell it today you would earn a total of 470.00 from holding News Corporation or generate 18.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Ship Lease vs. News Corp.
Performance |
| Timeline |
| Global Ship Lease |
| News |
Global Ship and News Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ship and News
The main advantage of trading using opposite Global Ship and News positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ship position performs unexpectedly, News 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 News will offset losses from the drop in News' long position.| Global Ship vs. Superior Plus Corp | Global Ship vs. SIVERS SEMICONDUCTORS AB | Global Ship vs. CHINA HUARONG ENERHD 50 | Global Ship vs. NORDIC HALIBUT AS |
| News vs. Nippon Steel | News vs. Daido Steel Co | News vs. Silicon Motion Technology | News vs. INDO RAMA SYNTHETIC |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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