Correlation Between Himalaya Shipping and Pangaea Logistic
Can any of the company-specific risk be diversified away by investing in both Himalaya Shipping and Pangaea Logistic 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 Himalaya Shipping and Pangaea Logistic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Himalaya Shipping and Pangaea Logistic, you can compare the effects of market volatilities on Himalaya Shipping and Pangaea Logistic 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 Himalaya Shipping with a short position of Pangaea Logistic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Himalaya Shipping and Pangaea Logistic.
Diversification Opportunities for Himalaya Shipping and Pangaea Logistic
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Himalaya and Pangaea is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Himalaya Shipping and Pangaea Logistic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pangaea Logistic and Himalaya Shipping 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 Himalaya Shipping are associated (or correlated) with Pangaea Logistic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pangaea Logistic has no effect on the direction of Himalaya Shipping i.e., Himalaya Shipping and Pangaea Logistic go up and down completely randomly.
Pair Corralation between Himalaya Shipping and Pangaea Logistic
Given the investment horizon of 90 days Himalaya Shipping is expected to generate 1.13 times more return on investment than Pangaea Logistic. However, Himalaya Shipping is 1.13 times more volatile than Pangaea Logistic. It trades about -0.02 of its potential returns per unit of risk. Pangaea Logistic is currently generating about -0.05 per unit of risk. If you would invest 615.00 in Himalaya Shipping on November 9, 2024 and sell it today you would lose (138.00) from holding Himalaya Shipping or give up 22.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Himalaya Shipping vs. Pangaea Logistic
Performance |
| Timeline |
| Himalaya Shipping |
| Pangaea Logistic |
Himalaya Shipping and Pangaea Logistic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Himalaya Shipping and Pangaea Logistic
The main advantage of trading using opposite Himalaya Shipping and Pangaea Logistic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Himalaya Shipping position performs unexpectedly, Pangaea Logistic 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 Pangaea Logistic will offset losses from the drop in Pangaea Logistic's long position.| Himalaya Shipping vs. Oceanpal | Himalaya Shipping vs. Safe Bulkers | Himalaya Shipping vs. Safe Bulkers | Himalaya Shipping vs. Safe Bulkers |
| Pangaea Logistic vs. EuroDry | Pangaea Logistic vs. Costamare | Pangaea Logistic vs. Global Ship Lease | Pangaea Logistic vs. Danaos |
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 CEOs Directory module to screen CEOs from public companies around the world.
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