Correlation Between Genco Shipping and Mitsubishi Electric
Can any of the company-specific risk be diversified away by investing in both Genco Shipping and Mitsubishi Electric 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 Mitsubishi Electric 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 Mitsubishi Electric, you can compare the effects of market volatilities on Genco Shipping and Mitsubishi Electric 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 Mitsubishi Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genco Shipping and Mitsubishi Electric.
Diversification Opportunities for Genco Shipping and Mitsubishi Electric
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Genco and Mitsubishi is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Genco Shipping Trading and Mitsubishi Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsubishi Electric 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 Mitsubishi Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsubishi Electric has no effect on the direction of Genco Shipping i.e., Genco Shipping and Mitsubishi Electric go up and down completely randomly.
Pair Corralation between Genco Shipping and Mitsubishi Electric
Assuming the 90 days trading horizon Genco Shipping Trading is expected to under-perform the Mitsubishi Electric. But the stock apears to be less risky and, when comparing its historical volatility, Genco Shipping Trading is 1.15 times less risky than Mitsubishi Electric. The stock trades about -0.03 of its potential returns per unit of risk. The Mitsubishi Electric is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,423 in Mitsubishi Electric on August 30, 2024 and sell it today you would earn a total of 146.00 from holding Mitsubishi Electric or generate 10.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Genco Shipping Trading vs. Mitsubishi Electric
Performance |
| Timeline |
| Genco Shipping Trading |
| Mitsubishi Electric |
Genco Shipping and Mitsubishi Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genco Shipping and Mitsubishi Electric
The main advantage of trading using opposite Genco Shipping and Mitsubishi Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genco Shipping position performs unexpectedly, Mitsubishi Electric 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 Mitsubishi Electric will offset losses from the drop in Mitsubishi Electric's long position.| Genco Shipping vs. PACIFIC ONLINE | Genco Shipping vs. FAST RETAIL ADR | Genco Shipping vs. BURLINGTON STORES | Genco Shipping vs. YATRA ONLINE DL 0001 |
| Mitsubishi Electric vs. Virtus Investment Partners | Mitsubishi Electric vs. Major Drilling Group | Mitsubishi Electric vs. MYFAIR GOLD P | Mitsubishi Electric vs. Genco Shipping Trading |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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