Correlation Between COSCO SHIPPING and Hapag Lloyd
Can any of the company-specific risk be diversified away by investing in both COSCO SHIPPING and Hapag Lloyd 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 COSCO SHIPPING and Hapag Lloyd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COSCO SHIPPING Holdings and Hapag Lloyd Aktiengesellschaft, you can compare the effects of market volatilities on COSCO SHIPPING and Hapag Lloyd 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 COSCO SHIPPING with a short position of Hapag Lloyd. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSCO SHIPPING and Hapag Lloyd.
Diversification Opportunities for COSCO SHIPPING and Hapag Lloyd
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between COSCO and Hapag is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding COSCO SHIPPING Holdings and Hapag Lloyd Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hapag Lloyd Aktienge and COSCO SHIPPING 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 COSCO SHIPPING Holdings are associated (or correlated) with Hapag Lloyd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hapag Lloyd Aktienge has no effect on the direction of COSCO SHIPPING i.e., COSCO SHIPPING and Hapag Lloyd go up and down completely randomly.
Pair Corralation between COSCO SHIPPING and Hapag Lloyd
Assuming the 90 days horizon COSCO SHIPPING Holdings is expected to generate 0.68 times more return on investment than Hapag Lloyd. However, COSCO SHIPPING Holdings is 1.47 times less risky than Hapag Lloyd. It trades about 0.08 of its potential returns per unit of risk. Hapag Lloyd Aktiengesellschaft is currently generating about 0.04 per unit of risk. If you would invest 463.00 in COSCO SHIPPING Holdings on September 12, 2024 and sell it today you would earn a total of 268.00 from holding COSCO SHIPPING Holdings or generate 57.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.95% |
| Values | Daily Returns |
COSCO SHIPPING Holdings vs. Hapag Lloyd Aktiengesellschaft
Performance |
| Timeline |
| COSCO SHIPPING Holdings |
| Hapag Lloyd Aktienge |
COSCO SHIPPING and Hapag Lloyd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COSCO SHIPPING and Hapag Lloyd
The main advantage of trading using opposite COSCO SHIPPING and Hapag Lloyd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COSCO SHIPPING position performs unexpectedly, Hapag Lloyd 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 Hapag Lloyd will offset losses from the drop in Hapag Lloyd's long position.| COSCO SHIPPING vs. Hapag Lloyd Aktiengesellschaft | COSCO SHIPPING vs. Nippon Yusen Kabushiki | COSCO SHIPPING vs. AP Moeller | COSCO SHIPPING vs. Orient Overseas International |
| Hapag Lloyd vs. AP Moeller Maersk AS | Hapag Lloyd vs. Nippon Yusen Kabushiki | Hapag Lloyd vs. COSCO SHIPPING Holdings | Hapag Lloyd vs. AP Moeller |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |