Correlation Between Global Ship and Fortress Transportation
Can any of the company-specific risk be diversified away by investing in both Global Ship and Fortress Transportation 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 Fortress Transportation 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 Fortress Transportation and, you can compare the effects of market volatilities on Global Ship and Fortress Transportation 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 Fortress Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and Fortress Transportation.
Diversification Opportunities for Global Ship and Fortress Transportation
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Fortress is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and Fortress Transportation and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortress Transportation 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 Fortress Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortress Transportation has no effect on the direction of Global Ship i.e., Global Ship and Fortress Transportation go up and down completely randomly.
Pair Corralation between Global Ship and Fortress Transportation
Considering the 90-day investment horizon Global Ship is expected to generate 1.1 times less return on investment than Fortress Transportation. In addition to that, Global Ship is 1.65 times more volatile than Fortress Transportation and. It trades about 0.05 of its total potential returns per unit of risk. Fortress Transportation and is currently generating about 0.09 per unit of volatility. If you would invest 1,603 in Fortress Transportation and on September 19, 2024 and sell it today you would earn a total of 977.00 from holding Fortress Transportation and or generate 60.95% 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. Fortress Transportation and
Performance |
| Timeline |
| Global Ship Lease |
| Fortress Transportation |
Global Ship and Fortress Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ship and Fortress Transportation
The main advantage of trading using opposite Global Ship and Fortress Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ship position performs unexpectedly, Fortress Transportation 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 Fortress Transportation will offset losses from the drop in Fortress Transportation's long position.| Global Ship vs. Costamare | Global Ship vs. Navios Maritime Partners | Global Ship vs. Genco Shipping Trading | Global Ship vs. Star Bulk Carriers |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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