Correlation Between Stolt Nielsen and Hapag Lloyd
Can any of the company-specific risk be diversified away by investing in both Stolt Nielsen and Hapag Lloyd 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 Stolt Nielsen and Hapag Lloyd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stolt Nielsen Limited and Hapag Lloyd Aktiengesellschaft, you can compare the effects of market volatilities on Stolt Nielsen and Hapag Lloyd 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 Stolt Nielsen with a short position of Hapag Lloyd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stolt Nielsen and Hapag Lloyd.
Diversification Opportunities for Stolt Nielsen and Hapag Lloyd
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Stolt and Hapag is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Stolt Nielsen Limited and Hapag Lloyd Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hapag Lloyd Aktienge and Stolt Nielsen 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 Stolt Nielsen Limited are associated (or correlated) with Hapag Lloyd. 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 Aktienge has no effect on the direction of Stolt Nielsen i.e., Stolt Nielsen and Hapag Lloyd go up and down completely randomly.
Pair Corralation between Stolt Nielsen and Hapag Lloyd
Assuming the 90 days horizon Stolt Nielsen Limited is expected to under-perform the Hapag Lloyd. In addition to that, Stolt Nielsen is 1.47 times more volatile than Hapag Lloyd Aktiengesellschaft. It trades about -0.05 of its total potential returns per unit of risk. Hapag Lloyd Aktiengesellschaft is currently generating about 0.06 per unit of volatility. If you would invest 16,362 in Hapag Lloyd Aktiengesellschaft on September 13, 2024 and sell it today you would earn a total of 411.00 from holding Hapag Lloyd Aktiengesellschaft or generate 2.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Stolt Nielsen Limited vs. Hapag Lloyd Aktiengesellschaft
Performance |
| Timeline |
| Stolt Nielsen Limited |
| Hapag Lloyd Aktienge |
Stolt Nielsen and Hapag Lloyd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stolt Nielsen and Hapag Lloyd
The main advantage of trading using opposite Stolt Nielsen and Hapag Lloyd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stolt Nielsen position performs unexpectedly, Hapag Lloyd 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 will offset losses from the drop in Hapag Lloyd's long position.| Stolt Nielsen vs. Hapag Lloyd Aktiengesellschaft | Stolt Nielsen vs. Nippon Yusen Kabushiki | Stolt Nielsen vs. COSCO SHIPPING Holdings | Stolt Nielsen vs. AP Moeller |
| Hapag Lloyd vs. AP Moeller Maersk AS | Hapag Lloyd vs. Nippon Yusen Kabushiki | Hapag Lloyd vs. COSCO SHIPPING Holdings | Hapag Lloyd vs. AP Moeller |
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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