Correlation Between Ardmore Shpng and Safe Bulkers
Can any of the company-specific risk be diversified away by investing in both Ardmore Shpng and Safe Bulkers 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 Ardmore Shpng and Safe Bulkers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ardmore Shpng and Safe Bulkers, you can compare the effects of market volatilities on Ardmore Shpng and Safe Bulkers 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 Ardmore Shpng with a short position of Safe Bulkers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ardmore Shpng and Safe Bulkers.
Diversification Opportunities for Ardmore Shpng and Safe Bulkers
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ardmore and Safe is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Ardmore Shpng and Safe Bulkers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safe Bulkers and Ardmore Shpng 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 Ardmore Shpng are associated (or correlated) with Safe Bulkers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safe Bulkers has no effect on the direction of Ardmore Shpng i.e., Ardmore Shpng and Safe Bulkers go up and down completely randomly.
Pair Corralation between Ardmore Shpng and Safe Bulkers
Considering the 90-day investment horizon Ardmore Shpng is expected to generate 8.77 times less return on investment than Safe Bulkers. In addition to that, Ardmore Shpng is 5.38 times more volatile than Safe Bulkers. It trades about 0.0 of its total potential returns per unit of risk. Safe Bulkers is currently generating about 0.08 per unit of volatility. If you would invest 2,514 in Safe Bulkers on November 1, 2024 and sell it today you would earn a total of 26.00 from holding Safe Bulkers or generate 1.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ardmore Shpng vs. Safe Bulkers
Performance |
| Timeline |
| Ardmore Shpng |
| Safe Bulkers |
Ardmore Shpng and Safe Bulkers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ardmore Shpng and Safe Bulkers
The main advantage of trading using opposite Ardmore Shpng and Safe Bulkers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ardmore Shpng position performs unexpectedly, Safe Bulkers 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 Safe Bulkers will offset losses from the drop in Safe Bulkers' long position.| Ardmore Shpng vs. International Seaways | Ardmore Shpng vs. Scorpio Tankers | Ardmore Shpng vs. Dorian LPG | Ardmore Shpng vs. Teekay Tankers |
| Safe Bulkers vs. Safe Bulkers | Safe Bulkers vs. Global Ship Lease | Safe Bulkers vs. Diana Shipping | Safe Bulkers vs. Costamare |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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