Correlation Between Global Ship and Globus Maritime
Can any of the company-specific risk be diversified away by investing in both Global Ship and Globus 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 Global Ship and Globus Maritime 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 Globus Maritime, you can compare the effects of market volatilities on Global Ship and Globus 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 Global Ship with a short position of Globus Maritime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and Globus Maritime.
Diversification Opportunities for Global Ship and Globus Maritime
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Globus is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and Globus Maritime in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globus Maritime 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 Globus Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globus Maritime has no effect on the direction of Global Ship i.e., Global Ship and Globus Maritime go up and down completely randomly.
Pair Corralation between Global Ship and Globus Maritime
Assuming the 90 days trading horizon Global Ship is expected to generate 1.33 times less return on investment than Globus Maritime. But when comparing it to its historical volatility, Global Ship Lease is 4.36 times less risky than Globus Maritime. It trades about 0.09 of its potential returns per unit of risk. Globus Maritime is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 137.00 in Globus Maritime on November 9, 2024 and sell it today you would earn a total of 1.00 from holding Globus Maritime or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Ship Lease vs. Globus Maritime
Performance |
| Timeline |
| Global Ship Lease |
| Globus Maritime |
Global Ship and Globus Maritime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ship and Globus Maritime
The main advantage of trading using opposite Global Ship and Globus Maritime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ship position performs unexpectedly, Globus 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 Globus Maritime will offset losses from the drop in Globus Maritime's long position.| Global Ship vs. Safe Bulkers | Global Ship vs. Diana Shipping | Global Ship vs. Costamare | Global Ship vs. Safe Bulkers |
| Globus Maritime vs. Seanergy Maritime Holdings | Globus Maritime vs. United Maritime | Globus Maritime vs. Performance Shipping | Globus Maritime vs. Castor Maritime |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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