Correlation Between Castor Maritime and Costamare
Can any of the company-specific risk be diversified away by investing in both Castor Maritime and Costamare 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 Castor Maritime and Costamare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Castor Maritime and Costamare, you can compare the effects of market volatilities on Castor Maritime and Costamare 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 Castor Maritime with a short position of Costamare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Castor Maritime and Costamare.
Diversification Opportunities for Castor Maritime and Costamare
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Castor and Costamare is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Castor Maritime and Costamare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Costamare and Castor Maritime 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 Castor Maritime are associated (or correlated) with Costamare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Costamare has no effect on the direction of Castor Maritime i.e., Castor Maritime and Costamare go up and down completely randomly.
Pair Corralation between Castor Maritime and Costamare
Given the investment horizon of 90 days Castor Maritime is expected to under-perform the Costamare. In addition to that, Castor Maritime is 1.69 times more volatile than Costamare. It trades about -0.05 of its total potential returns per unit of risk. Costamare is currently generating about 0.01 per unit of volatility. If you would invest 1,052 in Costamare on November 9, 2024 and sell it today you would earn a total of 20.00 from holding Costamare or generate 1.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Castor Maritime vs. Costamare
Performance |
| Timeline |
| Castor Maritime |
| Costamare |
Castor Maritime and Costamare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Castor Maritime and Costamare
The main advantage of trading using opposite Castor Maritime and Costamare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Castor Maritime position performs unexpectedly, Costamare 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 Costamare will offset losses from the drop in Costamare's long position.| Castor Maritime vs. Seanergy Maritime Holdings | Castor Maritime vs. TOP Ships | Castor Maritime vs. United Maritime | Castor Maritime vs. Nordic American Tankers |
| Costamare vs. Global Ship Lease | Costamare vs. Navios Maritime Partners | Costamare vs. Genco Shipping Trading | Costamare vs. Danaos |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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