Correlation Between Navios Maritime and Diana Shipping
Can any of the company-specific risk be diversified away by investing in both Navios Maritime and Diana Shipping 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 Navios Maritime and Diana Shipping into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Navios Maritime Partners and Diana Shipping, you can compare the effects of market volatilities on Navios Maritime and Diana Shipping 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 Navios Maritime with a short position of Diana Shipping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Navios Maritime and Diana Shipping.
Diversification Opportunities for Navios Maritime and Diana Shipping
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Navios and Diana is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Navios Maritime Partners and Diana Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diana Shipping and Navios Maritime 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 Navios Maritime Partners are associated (or correlated) with Diana Shipping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diana Shipping has no effect on the direction of Navios Maritime i.e., Navios Maritime and Diana Shipping go up and down completely randomly.
Pair Corralation between Navios Maritime and Diana Shipping
Considering the 90-day investment horizon Navios Maritime Partners is expected to under-perform the Diana Shipping. In addition to that, Navios Maritime is 1.15 times more volatile than Diana Shipping. It trades about -0.22 of its total potential returns per unit of risk. Diana Shipping is currently generating about -0.18 per unit of volatility. If you would invest 231.00 in Diana Shipping on August 23, 2024 and sell it today you would lose (21.00) from holding Diana Shipping or give up 9.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Navios Maritime Partners vs. Diana Shipping
Performance |
| Timeline |
| Navios Maritime Partners |
| Diana Shipping |
Navios Maritime and Diana Shipping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Navios Maritime and Diana Shipping
The main advantage of trading using opposite Navios Maritime and Diana Shipping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Navios Maritime position performs unexpectedly, Diana Shipping 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 Diana Shipping will offset losses from the drop in Diana Shipping's long position.| Navios Maritime vs. Global Ship Lease | Navios Maritime vs. Costamare | Navios Maritime vs. Genco Shipping Trading | Navios Maritime vs. Danaos |
| Diana Shipping vs. Star Bulk Carriers | Diana Shipping vs. Golden Ocean Group | Diana Shipping vs. Global Ship Lease | Diana Shipping vs. Genco Shipping Trading |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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