Correlation Between Global Ship and Fidus Investment
Can any of the company-specific risk be diversified away by investing in both Global Ship and Fidus Investment 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 Global Ship and Fidus Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Ship Lease and Fidus Investment Corp, you can compare the effects of market volatilities on Global Ship and Fidus Investment 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 Global Ship with a short position of Fidus Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and Fidus Investment.
Diversification Opportunities for Global Ship and Fidus Investment
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Global and Fidus is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and Fidus Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidus Investment Corp and Global Ship 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 Global Ship Lease are associated (or correlated) with Fidus Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidus Investment Corp has no effect on the direction of Global Ship i.e., Global Ship and Fidus Investment go up and down completely randomly.
Pair Corralation between Global Ship and Fidus Investment
Assuming the 90 days trading horizon Global Ship is expected to generate 2.73 times less return on investment than Fidus Investment. But when comparing it to its historical volatility, Global Ship Lease is 1.11 times less risky than Fidus Investment. It trades about 0.09 of its potential returns per unit of risk. Fidus Investment Corp is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,951 in Fidus Investment Corp on September 12, 2024 and sell it today you would earn a total of 190.00 from holding Fidus Investment Corp or generate 9.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Global Ship Lease vs. Fidus Investment Corp
Performance |
| Timeline |
| Global Ship Lease |
| Fidus Investment Corp |
Global Ship and Fidus Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ship and Fidus Investment
The main advantage of trading using opposite Global Ship and Fidus Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ship position performs unexpectedly, Fidus Investment 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 Fidus Investment will offset losses from the drop in Fidus Investment's long position.| Global Ship vs. Safe Bulkers | Global Ship vs. Diana Shipping | Global Ship vs. Costamare | Global Ship vs. Safe Bulkers |
| Fidus Investment vs. Visa Class A | Fidus Investment vs. Diamond Hill Investment | Fidus Investment vs. Distoken Acquisition | Fidus Investment vs. AllianceBernstein Holding LP |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |