Correlation Between Chimera Investment and Global Ship
Can any of the company-specific risk be diversified away by investing in both Chimera Investment and Global Ship 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 Chimera Investment and Global Ship into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chimera Investment and Global Ship Lease, you can compare the effects of market volatilities on Chimera Investment and Global Ship 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 Chimera Investment with a short position of Global Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chimera Investment and Global Ship.
Diversification Opportunities for Chimera Investment and Global Ship
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chimera and Global is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Chimera Investment and Global Ship Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Ship Lease and Chimera Investment 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 Chimera Investment are associated (or correlated) with Global Ship. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Ship Lease has no effect on the direction of Chimera Investment i.e., Chimera Investment and Global Ship go up and down completely randomly.
Pair Corralation between Chimera Investment and Global Ship
Assuming the 90 days trading horizon Chimera Investment is expected to generate 0.47 times more return on investment than Global Ship. However, Chimera Investment is 2.12 times less risky than Global Ship. It trades about 0.15 of its potential returns per unit of risk. Global Ship Lease is currently generating about 0.02 per unit of risk. If you would invest 2,470 in Chimera Investment on August 28, 2024 and sell it today you would earn a total of 25.00 from holding Chimera Investment or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chimera Investment vs. Global Ship Lease
Performance |
| Timeline |
| Chimera Investment |
| Global Ship Lease |
Chimera Investment and Global Ship Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chimera Investment and Global Ship
The main advantage of trading using opposite Chimera Investment and Global Ship positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chimera Investment position performs unexpectedly, Global Ship 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 Global Ship will offset losses from the drop in Global Ship's long position.| Chimera Investment vs. Chimera Investment | Chimera Investment vs. PennyMac Mortgage Investment | Chimera Investment vs. Two Harbors Investment | Chimera Investment vs. Chimera Investment |
| Global Ship vs. Safe Bulkers | Global Ship vs. Diana Shipping | Global Ship vs. Costamare | Global Ship vs. Safe Bulkers |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |