Correlation Between Pyxis Tankers and Imperial Petroleum
Can any of the company-specific risk be diversified away by investing in both Pyxis Tankers and Imperial Petroleum 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 Pyxis Tankers and Imperial Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pyxis Tankers and Imperial Petroleum Preferred, you can compare the effects of market volatilities on Pyxis Tankers and Imperial Petroleum 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 Pyxis Tankers with a short position of Imperial Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pyxis Tankers and Imperial Petroleum.
Diversification Opportunities for Pyxis Tankers and Imperial Petroleum
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pyxis and Imperial is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Pyxis Tankers and Imperial Petroleum Preferred in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imperial Petroleum and Pyxis Tankers 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 Pyxis Tankers are associated (or correlated) with Imperial Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imperial Petroleum has no effect on the direction of Pyxis Tankers i.e., Pyxis Tankers and Imperial Petroleum go up and down completely randomly.
Pair Corralation between Pyxis Tankers and Imperial Petroleum
Assuming the 90 days horizon Pyxis Tankers is expected to generate 110.18 times more return on investment than Imperial Petroleum. However, Pyxis Tankers is 110.18 times more volatile than Imperial Petroleum Preferred. It trades about 0.09 of its potential returns per unit of risk. Imperial Petroleum Preferred is currently generating about 0.08 per unit of risk. If you would invest 109.00 in Pyxis Tankers on August 24, 2024 and sell it today you would lose (59.00) from holding Pyxis Tankers or give up 54.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 76.0% |
| Values | Daily Returns |
Pyxis Tankers vs. Imperial Petroleum Preferred
Performance |
| Timeline |
| Pyxis Tankers |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Imperial Petroleum |
Pyxis Tankers and Imperial Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pyxis Tankers and Imperial Petroleum
The main advantage of trading using opposite Pyxis Tankers and Imperial Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pyxis Tankers position performs unexpectedly, Imperial Petroleum 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 Imperial Petroleum will offset losses from the drop in Imperial Petroleum's long position.| Pyxis Tankers vs. Ucommune International | Pyxis Tankers vs. Lion Financial Group | Pyxis Tankers vs. HUMANA INC | Pyxis Tankers vs. Aquagold International |
| Imperial Petroleum vs. Imperial Petroleum | Imperial Petroleum vs. Dynagas LNG Partners | Imperial Petroleum vs. GasLog Partners LP | Imperial Petroleum vs. GasLog Partners LP |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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