Correlation Between Paragon Shipping and SeaCo
Can any of the company-specific risk be diversified away by investing in both Paragon Shipping and SeaCo 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 Paragon Shipping and SeaCo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Paragon Shipping and SeaCo, you can compare the effects of market volatilities on Paragon Shipping and SeaCo 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 Paragon Shipping with a short position of SeaCo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Paragon Shipping and SeaCo.
Diversification Opportunities for Paragon Shipping and SeaCo
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Paragon and SeaCo is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Paragon Shipping and SeaCo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SeaCo and Paragon Shipping 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 Paragon Shipping are associated (or correlated) with SeaCo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SeaCo has no effect on the direction of Paragon Shipping i.e., Paragon Shipping and SeaCo go up and down completely randomly.
Pair Corralation between Paragon Shipping and SeaCo
If you would invest 0.01 in SeaCo on August 24, 2024 and sell it today you would earn a total of 0.00 from holding SeaCo or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
Paragon Shipping vs. SeaCo
Performance |
| Timeline |
| Paragon Shipping |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SeaCo |
Paragon Shipping and SeaCo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Paragon Shipping and SeaCo
The main advantage of trading using opposite Paragon Shipping and SeaCo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Paragon Shipping position performs unexpectedly, SeaCo 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 SeaCo will offset losses from the drop in SeaCo's long position.| Paragon Shipping vs. Celsius Holdings | Paragon Shipping vs. Boston Beer | Paragon Shipping vs. Ambev SA ADR | Paragon Shipping vs. Anheuser Busch Inbev |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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