Correlation Between AP Mller and Stolt Nielsen
Can any of the company-specific risk be diversified away by investing in both AP Mller and Stolt Nielsen 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 AP Mller and Stolt Nielsen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AP Mller and Stolt Nielsen Limited, you can compare the effects of market volatilities on AP Mller and Stolt Nielsen 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 AP Mller with a short position of Stolt Nielsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Mller and Stolt Nielsen.
Diversification Opportunities for AP Mller and Stolt Nielsen
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AMKBF and Stolt is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding AP Mller and Stolt Nielsen Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stolt Nielsen Limited and AP Mller 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 AP Mller are associated (or correlated) with Stolt Nielsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stolt Nielsen Limited has no effect on the direction of AP Mller i.e., AP Mller and Stolt Nielsen go up and down completely randomly.
Pair Corralation between AP Mller and Stolt Nielsen
Assuming the 90 days horizon AP Mller is expected to generate 0.89 times more return on investment than Stolt Nielsen. However, AP Mller is 1.13 times less risky than Stolt Nielsen. It trades about 0.19 of its potential returns per unit of risk. Stolt Nielsen Limited is currently generating about -0.16 per unit of risk. If you would invest 140,505 in AP Mller on September 5, 2024 and sell it today you would earn a total of 31,195 from holding AP Mller or generate 22.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AP Mller vs. Stolt Nielsen Limited
Performance |
| Timeline |
| AP Mller |
| Stolt Nielsen Limited |
AP Mller and Stolt Nielsen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Mller and Stolt Nielsen
The main advantage of trading using opposite AP Mller and Stolt Nielsen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Mller position performs unexpectedly, Stolt Nielsen 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 Stolt Nielsen will offset losses from the drop in Stolt Nielsen's long position.| AP Mller vs. Mitsui OSK Lines | AP Mller vs. Hapag Lloyd Aktiengesellschaft | AP Mller vs. Orient Overseas Limited | AP Mller vs. Hapag Lloyd Aktiengesellschaft |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |