Correlation Between Genco Shipping and United Maritime
Can any of the company-specific risk be diversified away by investing in both Genco Shipping and United Maritime 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 Genco Shipping and United Maritime into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genco Shipping Trading and United Maritime, you can compare the effects of market volatilities on Genco Shipping and United Maritime 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 Genco Shipping with a short position of United Maritime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genco Shipping and United Maritime.
Diversification Opportunities for Genco Shipping and United Maritime
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Genco and United is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Genco Shipping Trading and United Maritime in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Maritime and Genco 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 Genco Shipping Trading are associated (or correlated) with United Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Maritime has no effect on the direction of Genco Shipping i.e., Genco Shipping and United Maritime go up and down completely randomly.
Pair Corralation between Genco Shipping and United Maritime
Considering the 90-day investment horizon Genco Shipping Trading is expected to generate 0.71 times more return on investment than United Maritime. However, Genco Shipping Trading is 1.41 times less risky than United Maritime. It trades about 0.32 of its potential returns per unit of risk. United Maritime is currently generating about -0.22 per unit of risk. If you would invest 1,530 in Genco Shipping Trading on August 28, 2024 and sell it today you would earn a total of 174.00 from holding Genco Shipping Trading or generate 11.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Genco Shipping Trading vs. United Maritime
Performance |
| Timeline |
| Genco Shipping Trading |
| United Maritime |
Genco Shipping and United Maritime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genco Shipping and United Maritime
The main advantage of trading using opposite Genco Shipping and United Maritime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genco Shipping position performs unexpectedly, United Maritime 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 United Maritime will offset losses from the drop in United Maritime's long position.| Genco Shipping vs. Star Bulk Carriers | Genco Shipping vs. Golden Ocean Group | Genco Shipping vs. Global Ship Lease | Genco Shipping vs. Danaos |
| United Maritime vs. TOP Ships | United Maritime vs. Globus Maritime | United Maritime vs. Castor Maritime | United Maritime vs. Safe Bulkers |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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