Correlation Between Hapag Lloyd and Stolt Nielsen
Can any of the company-specific risk be diversified away by investing in both Hapag Lloyd and Stolt Nielsen 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 Hapag Lloyd and Stolt Nielsen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hapag Lloyd Aktiengesellschaft and Stolt Nielsen Limited, you can compare the effects of market volatilities on Hapag Lloyd and Stolt Nielsen 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 Hapag Lloyd with a short position of Stolt Nielsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hapag Lloyd and Stolt Nielsen.
Diversification Opportunities for Hapag Lloyd and Stolt Nielsen
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hapag and Stolt is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Hapag Lloyd Aktiengesellschaft and Stolt Nielsen Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stolt Nielsen Limited and Hapag Lloyd 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 Hapag Lloyd Aktiengesellschaft are associated (or correlated) with Stolt Nielsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stolt Nielsen Limited has no effect on the direction of Hapag Lloyd i.e., Hapag Lloyd and Stolt Nielsen go up and down completely randomly.
Pair Corralation between Hapag Lloyd and Stolt Nielsen
Assuming the 90 days horizon Hapag Lloyd Aktiengesellschaft is expected to generate 1.67 times more return on investment than Stolt Nielsen. However, Hapag Lloyd is 1.67 times more volatile than Stolt Nielsen Limited. It trades about 0.15 of its potential returns per unit of risk. Stolt Nielsen Limited is currently generating about -0.24 per unit of risk. If you would invest 14,319 in Hapag Lloyd Aktiengesellschaft on December 4, 2024 and sell it today you would earn a total of 1,295 from holding Hapag Lloyd Aktiengesellschaft or generate 9.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Hapag Lloyd Aktiengesellschaft vs. Stolt Nielsen Limited
Performance |
| Timeline |
| Hapag Lloyd Aktienge |
| Stolt Nielsen Limited |
Hapag Lloyd and Stolt Nielsen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hapag Lloyd and Stolt Nielsen
The main advantage of trading using opposite Hapag Lloyd and Stolt Nielsen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hapag Lloyd position performs unexpectedly, Stolt Nielsen 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 Stolt Nielsen will offset losses from the drop in Stolt Nielsen's long position.| Hapag Lloyd vs. AP Moeller Maersk AS | Hapag Lloyd vs. Nippon Yusen Kabushiki | Hapag Lloyd vs. COSCO SHIPPING Holdings | Hapag Lloyd vs. AP Moeller |
| Stolt Nielsen vs. Kawasaki Kisen Kaisha | Stolt Nielsen vs. MPC Container Ships | Stolt Nielsen vs. Mitsui OSK Lines | Stolt Nielsen vs. Pacific Basin Shipping |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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