Correlation Between Castor Maritime and Global Ship
Can any of the company-specific risk be diversified away by investing in both Castor Maritime 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 Castor Maritime and Global Ship into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Castor Maritime and Global Ship Lease, you can compare the effects of market volatilities on Castor Maritime 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 Castor Maritime with a short position of Global Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of Castor Maritime and Global Ship.
Diversification Opportunities for Castor Maritime and Global Ship
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Castor and Global is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Castor Maritime 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 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 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 Castor Maritime i.e., Castor Maritime and Global Ship go up and down completely randomly.
Pair Corralation between Castor Maritime and Global Ship
Given the investment horizon of 90 days Castor Maritime is expected to under-perform the Global Ship. In addition to that, Castor Maritime is 1.96 times more volatile than Global Ship Lease. It trades about -0.05 of its total potential returns per unit of risk. Global Ship Lease is currently generating about 0.04 per unit of volatility. If you would invest 1,908 in Global Ship Lease on November 9, 2024 and sell it today you would earn a total of 256.00 from holding Global Ship Lease or generate 13.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Castor Maritime vs. Global Ship Lease
Performance |
| Timeline |
| Castor Maritime |
| Global Ship Lease |
Castor Maritime and Global Ship Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Castor Maritime and Global Ship
The main advantage of trading using opposite Castor Maritime and Global Ship positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Castor Maritime 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.| Castor Maritime vs. Seanergy Maritime Holdings | Castor Maritime vs. TOP Ships | Castor Maritime vs. United Maritime | Castor Maritime vs. Nordic American Tankers |
| Global Ship vs. Costamare | Global Ship vs. Navios Maritime Partners | Global Ship vs. Genco Shipping Trading | Global Ship vs. Star Bulk Carriers |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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