Correlation Between Hertz Global and Global Ship
Can any of the company-specific risk be diversified away by investing in both Hertz Global and Global Ship 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 Hertz Global and Global Ship into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hertz Global Holdings and Global Ship Lease, you can compare the effects of market volatilities on Hertz Global and Global Ship 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 Hertz Global with a short position of Global Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hertz Global and Global Ship.
Diversification Opportunities for Hertz Global and Global Ship
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hertz and Global is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Hertz Global Holdings and Global Ship Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Ship Lease and Hertz Global 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 Hertz Global Holdings are associated (or correlated) with Global Ship. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Ship Lease has no effect on the direction of Hertz Global i.e., Hertz Global and Global Ship go up and down completely randomly.
Pair Corralation between Hertz Global and Global Ship
Considering the 90-day investment horizon Hertz Global Holdings is expected to under-perform the Global Ship. In addition to that, Hertz Global is 4.89 times more volatile than Global Ship Lease. It trades about -0.06 of its total potential returns per unit of risk. Global Ship Lease is currently generating about 0.05 per unit of volatility. If you would invest 2,173 in Global Ship Lease on August 27, 2024 and sell it today you would earn a total of 448.00 from holding Global Ship Lease or generate 20.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hertz Global Holdings vs. Global Ship Lease
Performance |
| Timeline |
| Hertz Global Holdings |
| Global Ship Lease |
Hertz Global and Global Ship Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hertz Global and Global Ship
The main advantage of trading using opposite Hertz Global and Global Ship positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hertz Global position performs unexpectedly, Global Ship 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 Global Ship will offset losses from the drop in Global Ship's long position.| Hertz Global vs. United Rentals | Hertz Global vs. Ryder System | Hertz Global vs. Herc Holdings | Hertz Global vs. Hertz Global Hldgs |
| Global Ship vs. Safe Bulkers | Global Ship vs. Diana Shipping | Global Ship vs. Costamare | Global Ship vs. Safe Bulkers |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |