Correlation Between Mitsui OSK and AP Moeller
Can any of the company-specific risk be diversified away by investing in both Mitsui OSK and AP Moeller 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 Mitsui OSK and AP Moeller into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitsui OSK Lines and AP Moeller , you can compare the effects of market volatilities on Mitsui OSK and AP Moeller 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 Mitsui OSK with a short position of AP Moeller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitsui OSK and AP Moeller.
Diversification Opportunities for Mitsui OSK and AP Moeller
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mitsui and AMKAF is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Mitsui OSK Lines and AP Moeller in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Moeller and Mitsui OSK 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 Mitsui OSK Lines are associated (or correlated) with AP Moeller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Moeller has no effect on the direction of Mitsui OSK i.e., Mitsui OSK and AP Moeller go up and down completely randomly.
Pair Corralation between Mitsui OSK and AP Moeller
Assuming the 90 days horizon Mitsui OSK is expected to generate 1.81 times less return on investment than AP Moeller. But when comparing it to its historical volatility, Mitsui OSK Lines is 1.42 times less risky than AP Moeller. It trades about 0.13 of its potential returns per unit of risk. AP Moeller is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 150,000 in AP Moeller on August 25, 2024 and sell it today you would earn a total of 15,500 from holding AP Moeller or generate 10.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mitsui OSK Lines vs. AP Moeller
Performance |
| Timeline |
| Mitsui OSK Lines |
| AP Moeller |
Mitsui OSK and AP Moeller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitsui OSK and AP Moeller
The main advantage of trading using opposite Mitsui OSK and AP Moeller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitsui OSK position performs unexpectedly, AP Moeller 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 AP Moeller will offset losses from the drop in AP Moeller's long position.| Mitsui OSK vs. SITC International Holdings | Mitsui OSK vs. Orient Overseas Limited | Mitsui OSK vs. Western Bulk Chartering | Mitsui OSK vs. Hapag Lloyd Aktiengesellschaft |
| AP Moeller vs. Hapag Lloyd Aktiengesellschaft | AP Moeller vs. AP Mller | AP Moeller vs. COSCO SHIPPING Holdings | AP Moeller vs. Nippon Yusen Kabushiki |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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