Correlation Between Safe Bulkers and Hapag-Lloyd Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both Safe Bulkers and Hapag-Lloyd Aktiengesellscha 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 Hapag-Lloyd Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safe Bulkers and Hapag Lloyd Aktiengesellschaft, you can compare the effects of market volatilities on Safe Bulkers and Hapag-Lloyd Aktiengesellscha 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 Hapag-Lloyd Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safe Bulkers and Hapag-Lloyd Aktiengesellscha.
Diversification Opportunities for Safe Bulkers and Hapag-Lloyd Aktiengesellscha
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Safe and Hapag-Lloyd is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Safe Bulkers and Hapag Lloyd Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hapag-Lloyd Aktiengesellscha 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 Hapag-Lloyd Aktiengesellscha. 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 Aktiengesellscha has no effect on the direction of Safe Bulkers i.e., Safe Bulkers and Hapag-Lloyd Aktiengesellscha go up and down completely randomly.
Pair Corralation between Safe Bulkers and Hapag-Lloyd Aktiengesellscha
Assuming the 90 days horizon Safe Bulkers is expected to generate 10.78 times less return on investment than Hapag-Lloyd Aktiengesellscha. But when comparing it to its historical volatility, Safe Bulkers is 18.34 times less risky than Hapag-Lloyd Aktiengesellscha. It trades about 0.08 of its potential returns per unit of risk. Hapag Lloyd Aktiengesellschaft is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 15,050 in Hapag Lloyd Aktiengesellschaft on September 2, 2024 and sell it today you would earn a total of 1,125 from holding Hapag Lloyd Aktiengesellschaft or generate 7.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 91.24% |
| Values | Daily Returns |
Safe Bulkers vs. Hapag Lloyd Aktiengesellschaft
Performance |
| Timeline |
| Safe Bulkers |
| Hapag-Lloyd Aktiengesellscha |
Safe Bulkers and Hapag-Lloyd Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safe Bulkers and Hapag-Lloyd Aktiengesellscha
The main advantage of trading using opposite Safe Bulkers and Hapag-Lloyd Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safe Bulkers position performs unexpectedly, Hapag-Lloyd Aktiengesellscha 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 Aktiengesellscha will offset losses from the drop in Hapag-Lloyd Aktiengesellscha's long position.| Safe Bulkers vs. Safe Bulkers | Safe Bulkers vs. Global Ship Lease | Safe Bulkers vs. Diana Shipping | Safe Bulkers vs. Costamare |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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