Correlation Between EIDESVIK OFFSHORE and Genco Shipping
Can any of the company-specific risk be diversified away by investing in both EIDESVIK OFFSHORE 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 EIDESVIK OFFSHORE and Genco Shipping into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EIDESVIK OFFSHORE NK and Genco Shipping Trading, you can compare the effects of market volatilities on EIDESVIK OFFSHORE 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 EIDESVIK OFFSHORE with a short position of Genco Shipping. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIDESVIK OFFSHORE and Genco Shipping.
Diversification Opportunities for EIDESVIK OFFSHORE and Genco Shipping
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between EIDESVIK and Genco is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding EIDESVIK OFFSHORE NK 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 EIDESVIK OFFSHORE 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 EIDESVIK OFFSHORE NK 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 EIDESVIK OFFSHORE i.e., EIDESVIK OFFSHORE and Genco Shipping go up and down completely randomly.
Pair Corralation between EIDESVIK OFFSHORE and Genco Shipping
Assuming the 90 days horizon EIDESVIK OFFSHORE NK is expected to under-perform the Genco Shipping. But the stock apears to be less risky and, when comparing its historical volatility, EIDESVIK OFFSHORE NK is 1.41 times less risky than Genco Shipping. The stock trades about -0.08 of its potential returns per unit of risk. The Genco Shipping Trading is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,393 in Genco Shipping Trading on September 1, 2024 and sell it today you would earn a total of 111.00 from holding Genco Shipping Trading or generate 7.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EIDESVIK OFFSHORE NK vs. Genco Shipping Trading
Performance |
| Timeline |
| EIDESVIK OFFSHORE |
| Genco Shipping Trading |
EIDESVIK OFFSHORE and Genco Shipping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIDESVIK OFFSHORE and Genco Shipping
The main advantage of trading using opposite EIDESVIK OFFSHORE and Genco Shipping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIDESVIK OFFSHORE 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.| EIDESVIK OFFSHORE vs. LGI Homes | EIDESVIK OFFSHORE vs. UMC Electronics Co | EIDESVIK OFFSHORE vs. Richardson Electronics | EIDESVIK OFFSHORE vs. Aedas Homes SA |
| Genco Shipping vs. Clarkson PLC | Genco Shipping vs. Wilh Wilhelmsen Holding | Genco Shipping vs. Superior Plus Corp | Genco Shipping vs. NMI Holdings |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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