Correlation Between Hutchison Port and Safe Bulkers
Can any of the company-specific risk be diversified away by investing in both Hutchison Port and Safe Bulkers 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 Hutchison Port and Safe Bulkers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hutchison Port Holdings and Safe Bulkers, you can compare the effects of market volatilities on Hutchison Port and Safe Bulkers 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 Hutchison Port with a short position of Safe Bulkers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hutchison Port and Safe Bulkers.
Diversification Opportunities for Hutchison Port and Safe Bulkers
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hutchison and Safe is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Hutchison Port Holdings and Safe Bulkers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safe Bulkers and Hutchison Port 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 Hutchison Port Holdings are associated (or correlated) with Safe Bulkers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safe Bulkers has no effect on the direction of Hutchison Port i.e., Hutchison Port and Safe Bulkers go up and down completely randomly.
Pair Corralation between Hutchison Port and Safe Bulkers
Assuming the 90 days horizon Hutchison Port Holdings is expected to generate 6.66 times more return on investment than Safe Bulkers. However, Hutchison Port is 6.66 times more volatile than Safe Bulkers. It trades about 0.03 of its potential returns per unit of risk. Safe Bulkers is currently generating about 0.08 per unit of risk. If you would invest 309.00 in Hutchison Port Holdings on September 2, 2024 and sell it today you would earn a total of 36.00 from holding Hutchison Port Holdings or generate 11.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.39% |
| Values | Daily Returns |
Hutchison Port Holdings vs. Safe Bulkers
Performance |
| Timeline |
| Hutchison Port Holdings |
| Safe Bulkers |
Hutchison Port and Safe Bulkers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hutchison Port and Safe Bulkers
The main advantage of trading using opposite Hutchison Port and Safe Bulkers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hutchison Port position performs unexpectedly, Safe Bulkers 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 Safe Bulkers will offset losses from the drop in Safe Bulkers' long position.| Hutchison Port vs. AP Mller | Hutchison Port vs. COSCO SHIPPING Holdings | Hutchison Port vs. Orient Overseas Limited |
| Safe Bulkers vs. Safe Bulkers | Safe Bulkers vs. Global Ship Lease | Safe Bulkers vs. Diana Shipping | Safe Bulkers vs. Costamare |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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