Correlation Between Hafnia and SEACOR Marine
Can any of the company-specific risk be diversified away by investing in both Hafnia and SEACOR Marine 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 Hafnia and SEACOR Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hafnia Limited and SEACOR Marine Holdings, you can compare the effects of market volatilities on Hafnia and SEACOR Marine 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 Hafnia with a short position of SEACOR Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hafnia and SEACOR Marine.
Diversification Opportunities for Hafnia and SEACOR Marine
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hafnia and SEACOR is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hafnia Limited and SEACOR Marine Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEACOR Marine Holdings and Hafnia 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 Hafnia Limited are associated (or correlated) with SEACOR Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEACOR Marine Holdings has no effect on the direction of Hafnia i.e., Hafnia and SEACOR Marine go up and down completely randomly.
Pair Corralation between Hafnia and SEACOR Marine
Given the investment horizon of 90 days Hafnia Limited is expected to generate 0.38 times more return on investment than SEACOR Marine. However, Hafnia Limited is 2.6 times less risky than SEACOR Marine. It trades about -0.24 of its potential returns per unit of risk. SEACOR Marine Holdings is currently generating about -0.14 per unit of risk. If you would invest 623.00 in Hafnia Limited on August 24, 2024 and sell it today you would lose (74.00) from holding Hafnia Limited or give up 11.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hafnia Limited vs. SEACOR Marine Holdings
Performance |
| Timeline |
| Hafnia Limited |
| SEACOR Marine Holdings |
Hafnia and SEACOR Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hafnia and SEACOR Marine
The main advantage of trading using opposite Hafnia and SEACOR Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hafnia position performs unexpectedly, SEACOR Marine 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 SEACOR Marine will offset losses from the drop in SEACOR Marine's long position.| Hafnia vs. Sanyo Special Steel | Hafnia vs. Titan International | Hafnia vs. Olympic Steel | Hafnia vs. CECO Environmental Corp |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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