Correlation Between International Seaways and Dynagas LNG
Can any of the company-specific risk be diversified away by investing in both International Seaways and Dynagas LNG 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 International Seaways and Dynagas LNG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Seaways and Dynagas LNG Partners, you can compare the effects of market volatilities on International Seaways and Dynagas LNG 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 International Seaways with a short position of Dynagas LNG. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Seaways and Dynagas LNG.
Diversification Opportunities for International Seaways and Dynagas LNG
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between International and Dynagas is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding International Seaways and Dynagas LNG Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dynagas LNG Partners and International Seaways 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 International Seaways are associated (or correlated) with Dynagas LNG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dynagas LNG Partners has no effect on the direction of International Seaways i.e., International Seaways and Dynagas LNG go up and down completely randomly.
Pair Corralation between International Seaways and Dynagas LNG
Given the investment horizon of 90 days International Seaways is expected to generate 4.11 times less return on investment than Dynagas LNG. In addition to that, International Seaways is 3.34 times more volatile than Dynagas LNG Partners. It trades about 0.01 of its total potential returns per unit of risk. Dynagas LNG Partners is currently generating about 0.12 per unit of volatility. If you would invest 2,166 in Dynagas LNG Partners on September 4, 2024 and sell it today you would earn a total of 377.00 from holding Dynagas LNG Partners or generate 17.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Seaways vs. Dynagas LNG Partners
Performance |
| Timeline |
| International Seaways |
| Dynagas LNG Partners |
International Seaways and Dynagas LNG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Seaways and Dynagas LNG
The main advantage of trading using opposite International Seaways and Dynagas LNG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Seaways position performs unexpectedly, Dynagas LNG 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 Dynagas LNG will offset losses from the drop in Dynagas LNG's long position.| International Seaways vs. EnLink Midstream LLC | International Seaways vs. Western Midstream Partners | International Seaways vs. Plains GP Holdings | International Seaways vs. Hess Midstream Partners |
| Dynagas LNG vs. GasLog Partners LP | Dynagas LNG vs. Dynagas LNG Partners | Dynagas LNG vs. GasLog Partners LP | Dynagas LNG vs. Seapeak LLC |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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