Correlation Between Orient Overseas and Hapag Lloyd
Can any of the company-specific risk be diversified away by investing in both Orient Overseas and Hapag Lloyd 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 Orient Overseas and Hapag Lloyd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orient Overseas Limited and Hapag Lloyd Aktiengesellschaft, you can compare the effects of market volatilities on Orient Overseas and Hapag Lloyd 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 Orient Overseas with a short position of Hapag Lloyd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orient Overseas and Hapag Lloyd.
Diversification Opportunities for Orient Overseas and Hapag Lloyd
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Orient and Hapag is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Orient Overseas Limited and Hapag Lloyd Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hapag Lloyd Aktienge and Orient Overseas 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 Orient Overseas Limited are associated (or correlated) with Hapag Lloyd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hapag Lloyd Aktienge has no effect on the direction of Orient Overseas i.e., Orient Overseas and Hapag Lloyd go up and down completely randomly.
Pair Corralation between Orient Overseas and Hapag Lloyd
Assuming the 90 days horizon Orient Overseas Limited is expected to generate 0.16 times more return on investment than Hapag Lloyd. However, Orient Overseas Limited is 6.32 times less risky than Hapag Lloyd. It trades about 0.22 of its potential returns per unit of risk. Hapag Lloyd Aktiengesellschaft is currently generating about -0.19 per unit of risk. If you would invest 1,370 in Orient Overseas Limited on August 27, 2024 and sell it today you would earn a total of 26.00 from holding Orient Overseas Limited or generate 1.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orient Overseas Limited vs. Hapag Lloyd Aktiengesellschaft
Performance |
| Timeline |
| Orient Overseas |
| Hapag Lloyd Aktienge |
Orient Overseas and Hapag Lloyd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orient Overseas and Hapag Lloyd
The main advantage of trading using opposite Orient Overseas and Hapag Lloyd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orient Overseas position performs unexpectedly, Hapag Lloyd 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 Hapag Lloyd will offset losses from the drop in Hapag Lloyd's long position.| Orient Overseas vs. SITC International Holdings | Orient Overseas vs. COSCO SHIPPING Holdings | Orient Overseas vs. Pacific Basin Shipping | Orient Overseas vs. Mitsui OSK Lines |
| Hapag Lloyd vs. AP Moeller | Hapag Lloyd vs. Orient Overseas Limited | Hapag Lloyd vs. AP Mller | Hapag Lloyd vs. Mitsui OSK Lines |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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