Correlation Between GasLog Partners and Torm PLC
Can any of the company-specific risk be diversified away by investing in both GasLog Partners and Torm PLC 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 GasLog Partners and Torm PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GasLog Partners LP and Torm PLC Class, you can compare the effects of market volatilities on GasLog Partners and Torm PLC 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 GasLog Partners with a short position of Torm PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of GasLog Partners and Torm PLC.
Diversification Opportunities for GasLog Partners and Torm PLC
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GasLog and Torm is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding GasLog Partners LP and Torm PLC Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Torm PLC Class and GasLog Partners 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 GasLog Partners LP are associated (or correlated) with Torm PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Torm PLC Class has no effect on the direction of GasLog Partners i.e., GasLog Partners and Torm PLC go up and down completely randomly.
Pair Corralation between GasLog Partners and Torm PLC
Assuming the 90 days trading horizon GasLog Partners LP is expected to generate 0.19 times more return on investment than Torm PLC. However, GasLog Partners LP is 5.39 times less risky than Torm PLC. It trades about 0.1 of its potential returns per unit of risk. Torm PLC Class is currently generating about -0.04 per unit of risk. If you would invest 2,530 in GasLog Partners LP on November 9, 2024 and sell it today you would earn a total of 27.00 from holding GasLog Partners LP or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GasLog Partners LP vs. Torm PLC Class
Performance |
| Timeline |
| GasLog Partners LP |
| Torm PLC Class |
GasLog Partners and Torm PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GasLog Partners and Torm PLC
The main advantage of trading using opposite GasLog Partners and Torm PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GasLog Partners position performs unexpectedly, Torm PLC 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 Torm PLC will offset losses from the drop in Torm PLC's long position.| GasLog Partners vs. GasLog Partners LP | GasLog Partners vs. Seapeak LLC | GasLog Partners vs. Dynagas LNG Partners | GasLog Partners vs. NGL Energy Partners |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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