Correlation Between Dorian LPG and GasLog Partners
Can any of the company-specific risk be diversified away by investing in both Dorian LPG and GasLog Partners 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 Dorian LPG and GasLog Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dorian LPG and GasLog Partners LP, you can compare the effects of market volatilities on Dorian LPG and GasLog Partners 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 Dorian LPG with a short position of GasLog Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dorian LPG and GasLog Partners.
Diversification Opportunities for Dorian LPG and GasLog Partners
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dorian and GasLog is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Dorian LPG and GasLog Partners LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GasLog Partners LP and Dorian LPG 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 Dorian LPG are associated (or correlated) with GasLog Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GasLog Partners LP has no effect on the direction of Dorian LPG i.e., Dorian LPG and GasLog Partners go up and down completely randomly.
Pair Corralation between Dorian LPG and GasLog Partners
Considering the 90-day investment horizon Dorian LPG is expected to under-perform the GasLog Partners. In addition to that, Dorian LPG is 6.52 times more volatile than GasLog Partners LP. It trades about -0.04 of its total potential returns per unit of risk. GasLog Partners LP is currently generating about 0.15 per unit of volatility. If you would invest 2,259 in GasLog Partners LP on September 4, 2024 and sell it today you would earn a total of 318.00 from holding GasLog Partners LP or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dorian LPG vs. GasLog Partners LP
Performance |
| Timeline |
| Dorian LPG |
| GasLog Partners LP |
Dorian LPG and GasLog Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dorian LPG and GasLog Partners
The main advantage of trading using opposite Dorian LPG and GasLog Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dorian LPG position performs unexpectedly, GasLog Partners 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 GasLog Partners will offset losses from the drop in GasLog Partners' long position.| Dorian LPG vs. DHT Holdings | Dorian LPG vs. Scorpio Tankers | Dorian LPG vs. Teekay Tankers | Dorian LPG vs. Torm PLC Class |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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