Correlation Between Safe Bulkers and Kawasaki Kisen
Can any of the company-specific risk be diversified away by investing in both Safe Bulkers and Kawasaki Kisen 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 Kawasaki Kisen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safe Bulkers and Kawasaki Kisen Kaisha, you can compare the effects of market volatilities on Safe Bulkers and Kawasaki Kisen 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 Kawasaki Kisen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safe Bulkers and Kawasaki Kisen.
Diversification Opportunities for Safe Bulkers and Kawasaki Kisen
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Safe and Kawasaki is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Safe Bulkers and Kawasaki Kisen Kaisha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kawasaki Kisen Kaisha 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 Kawasaki Kisen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kawasaki Kisen Kaisha has no effect on the direction of Safe Bulkers i.e., Safe Bulkers and Kawasaki Kisen go up and down completely randomly.
Pair Corralation between Safe Bulkers and Kawasaki Kisen
Assuming the 90 days horizon Safe Bulkers is expected to generate 42.39 times less return on investment than Kawasaki Kisen. But when comparing it to its historical volatility, Safe Bulkers is 35.61 times less risky than Kawasaki Kisen. It trades about 0.08 of its potential returns per unit of risk. Kawasaki Kisen Kaisha is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 545.00 in Kawasaki Kisen Kaisha on September 2, 2024 and sell it today you would earn a total of 925.00 from holding Kawasaki Kisen Kaisha or generate 169.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 86.56% |
| Values | Daily Returns |
Safe Bulkers vs. Kawasaki Kisen Kaisha
Performance |
| Timeline |
| Safe Bulkers |
| Kawasaki Kisen Kaisha |
Safe Bulkers and Kawasaki Kisen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safe Bulkers and Kawasaki Kisen
The main advantage of trading using opposite Safe Bulkers and Kawasaki Kisen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safe Bulkers position performs unexpectedly, Kawasaki Kisen 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 Kawasaki Kisen will offset losses from the drop in Kawasaki Kisen's long position.| Safe Bulkers vs. Safe Bulkers | Safe Bulkers vs. Global Ship Lease | Safe Bulkers vs. Diana Shipping | Safe Bulkers vs. Costamare |
| Kawasaki Kisen vs. Pacific Basin Shipping | Kawasaki Kisen vs. Hapag Lloyd Aktiengesellschaft | Kawasaki Kisen vs. Hapag Lloyd Aktiengesellschaft | Kawasaki Kisen vs. Hutchison Port Holdings |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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