Correlation Between Costamare and Globus Maritime
Can any of the company-specific risk be diversified away by investing in both Costamare and Globus Maritime 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 Costamare and Globus Maritime into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Costamare and Globus Maritime, you can compare the effects of market volatilities on Costamare and Globus Maritime 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 Costamare with a short position of Globus Maritime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Costamare and Globus Maritime.
Diversification Opportunities for Costamare and Globus Maritime
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Costamare and Globus is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Costamare and Globus Maritime in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globus Maritime and Costamare 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 Costamare are associated (or correlated) with Globus Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globus Maritime has no effect on the direction of Costamare i.e., Costamare and Globus Maritime go up and down completely randomly.
Pair Corralation between Costamare and Globus Maritime
Given the investment horizon of 90 days Costamare is expected to generate 0.39 times more return on investment than Globus Maritime. However, Costamare is 2.54 times less risky than Globus Maritime. It trades about 0.18 of its potential returns per unit of risk. Globus Maritime is currently generating about -0.13 per unit of risk. If you would invest 1,344 in Costamare on August 24, 2024 and sell it today you would earn a total of 85.00 from holding Costamare or generate 6.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Costamare vs. Globus Maritime
Performance |
| Timeline |
| Costamare |
| Globus Maritime |
Costamare and Globus Maritime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Costamare and Globus Maritime
The main advantage of trading using opposite Costamare and Globus Maritime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Costamare position performs unexpectedly, Globus Maritime 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 Globus Maritime will offset losses from the drop in Globus Maritime's long position.| Costamare vs. Global Ship Lease | Costamare vs. Navios Maritime Partners | Costamare vs. Genco Shipping Trading | Costamare vs. Danaos |
| Globus Maritime vs. Seanergy Maritime Holdings | Globus Maritime vs. United Maritime | Globus Maritime vs. Performance Shipping | Globus Maritime vs. Castor Maritime |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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