Correlation Between Safe Bulkers and Capital Clean
Can any of the company-specific risk be diversified away by investing in both Safe Bulkers and Capital Clean 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 Safe Bulkers and Capital Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safe Bulkers and Capital Clean Energy, you can compare the effects of market volatilities on Safe Bulkers and Capital Clean 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 Safe Bulkers with a short position of Capital Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safe Bulkers and Capital Clean.
Diversification Opportunities for Safe Bulkers and Capital Clean
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Safe and Capital is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Safe Bulkers and Capital Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Clean Energy and Safe Bulkers 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 Safe Bulkers are associated (or correlated) with Capital Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Clean Energy has no effect on the direction of Safe Bulkers i.e., Safe Bulkers and Capital Clean go up and down completely randomly.
Pair Corralation between Safe Bulkers and Capital Clean
Assuming the 90 days horizon Safe Bulkers is expected to generate 1.79 times less return on investment than Capital Clean. But when comparing it to its historical volatility, Safe Bulkers is 3.41 times less risky than Capital Clean. It trades about 0.2 of its potential returns per unit of risk. Capital Clean Energy is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,858 in Capital Clean Energy on November 4, 2024 and sell it today you would earn a total of 61.00 from holding Capital Clean Energy or generate 3.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Safe Bulkers vs. Capital Clean Energy
Performance |
| Timeline |
| Safe Bulkers |
| Capital Clean Energy |
Safe Bulkers and Capital Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safe Bulkers and Capital Clean
The main advantage of trading using opposite Safe Bulkers and Capital Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safe Bulkers position performs unexpectedly, Capital Clean 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 Capital Clean will offset losses from the drop in Capital Clean's long position.| Safe Bulkers vs. Safe Bulkers | Safe Bulkers vs. Global Ship Lease | Safe Bulkers vs. Diana Shipping | Safe Bulkers vs. Costamare |
| Capital Clean vs. Cintas | Capital Clean vs. Enzyme Environmental Solutions | Capital Clean vs. The Gap, | Capital Clean vs. Olympic Steel |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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