Correlation Between SITC International and Western Bulk
Can any of the company-specific risk be diversified away by investing in both SITC International and Western Bulk 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 SITC International and Western Bulk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SITC International Holdings and Western Bulk Chartering, you can compare the effects of market volatilities on SITC International and Western Bulk 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 SITC International with a short position of Western Bulk. Check out your portfolio center. Please also check ongoing floating volatility patterns of SITC International and Western Bulk.
Diversification Opportunities for SITC International and Western Bulk
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SITC and Western is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding SITC International Holdings and Western Bulk Chartering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Bulk Chartering and SITC International 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 SITC International Holdings are associated (or correlated) with Western Bulk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Bulk Chartering has no effect on the direction of SITC International i.e., SITC International and Western Bulk go up and down completely randomly.
Pair Corralation between SITC International and Western Bulk
If you would invest 118.00 in Western Bulk Chartering on November 9, 2024 and sell it today you would earn a total of 0.00 from holding Western Bulk Chartering or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
SITC International Holdings vs. Western Bulk Chartering
Performance |
| Timeline |
| SITC International |
| Western Bulk Chartering |
SITC International and Western Bulk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SITC International and Western Bulk
The main advantage of trading using opposite SITC International and Western Bulk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SITC International position performs unexpectedly, Western Bulk 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 Western Bulk will offset losses from the drop in Western Bulk's long position.| SITC International vs. Nippon Yusen Kabushiki | SITC International vs. AP Moeller | SITC International vs. Orient Overseas Limited | SITC International vs. Western Bulk Chartering |
| Western Bulk vs. SITC International Holdings | Western Bulk vs. Pacific Basin Shipping | Western Bulk vs. SITC International Holdings | Western Bulk vs. Mitsui OSK Lines |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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