Correlation Between StealthGas and Global Ship
Can any of the company-specific risk be diversified away by investing in both StealthGas 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 StealthGas and Global Ship into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between StealthGas and Global Ship Lease, you can compare the effects of market volatilities on StealthGas 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 StealthGas with a short position of Global Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of StealthGas and Global Ship.
Diversification Opportunities for StealthGas and Global Ship
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between StealthGas and Global is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding StealthGas 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 StealthGas 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 StealthGas 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 StealthGas i.e., StealthGas and Global Ship go up and down completely randomly.
Pair Corralation between StealthGas and Global Ship
Given the investment horizon of 90 days StealthGas is expected to under-perform the Global Ship. In addition to that, StealthGas is 1.49 times more volatile than Global Ship Lease. It trades about -0.02 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
StealthGas vs. Global Ship Lease
Performance |
| Timeline |
| StealthGas |
| Global Ship Lease |
StealthGas and Global Ship Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with StealthGas and Global Ship
The main advantage of trading using opposite StealthGas and Global Ship positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if StealthGas 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.| StealthGas vs. Danaos | StealthGas vs. Global Ship Lease | StealthGas vs. Euroseas | StealthGas vs. Navios Maritime Partners |
| 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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