Correlation Between Diana Shipping and Genco Shipping
Can any of the company-specific risk be diversified away by investing in both Diana Shipping and Genco Shipping 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 Diana Shipping and Genco Shipping into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diana Shipping and Genco Shipping Trading, you can compare the effects of market volatilities on Diana Shipping and Genco Shipping 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 Diana Shipping with a short position of Genco Shipping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diana Shipping and Genco Shipping.
Diversification Opportunities for Diana Shipping and Genco Shipping
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Diana and Genco is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Diana Shipping and Genco Shipping Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genco Shipping Trading and Diana 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 Diana Shipping are associated (or correlated) with Genco Shipping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genco Shipping Trading has no effect on the direction of Diana Shipping i.e., Diana Shipping and Genco Shipping go up and down completely randomly.
Pair Corralation between Diana Shipping and Genco Shipping
Assuming the 90 days trading horizon Diana Shipping is expected to generate 0.4 times more return on investment than Genco Shipping. However, Diana Shipping is 2.51 times less risky than Genco Shipping. It trades about 0.07 of its potential returns per unit of risk. Genco Shipping Trading is currently generating about -0.03 per unit of risk. If you would invest 2,434 in Diana Shipping on August 27, 2024 and sell it today you would earn a total of 206.00 from holding Diana Shipping or generate 8.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Diana Shipping vs. Genco Shipping Trading
Performance |
| Timeline |
| Diana Shipping |
| Genco Shipping Trading |
Diana Shipping and Genco Shipping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Diana Shipping and Genco Shipping
The main advantage of trading using opposite Diana Shipping and Genco Shipping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diana Shipping position performs unexpectedly, Genco Shipping 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 Genco Shipping will offset losses from the drop in Genco Shipping's long position.| Diana Shipping vs. Global Ship Lease | Diana Shipping vs. Safe Bulkers | Diana Shipping vs. Costamare | Diana Shipping vs. Safe Bulkers |
| Genco Shipping vs. Star Bulk Carriers | Genco Shipping vs. TOP Ships | Genco Shipping vs. Seanergy Maritime Holdings | Genco Shipping vs. Performance Shipping |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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