Correlation Between Awilco LNG and Okeanis Eco

Can any of the company-specific risk be diversified away by investing in both Awilco LNG and Okeanis Eco 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 Awilco LNG and Okeanis Eco into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Awilco LNG ASA and Okeanis Eco Tankers, you can compare the effects of market volatilities on Awilco LNG and Okeanis Eco 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 Awilco LNG with a short position of Okeanis Eco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Awilco LNG and Okeanis Eco.

Diversification Opportunities for Awilco LNG and Okeanis Eco

-0.02

Correlation Coefficient

Awilco LNG  Okeanis Eco

Good diversification

The 3 months correlation between Awilco and Okeanis is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Awilco LNG ASA and Okeanis Eco Tankers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Okeanis Eco Tankers and Awilco LNG 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 Awilco LNG ASA are associated (or correlated) with Okeanis Eco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Okeanis Eco Tankers has no effect on the direction of Awilco LNG i.e., Awilco LNG and Okeanis Eco go up and down completely randomly.

Pair Corralation between Awilco LNG and Okeanis Eco

Assuming the 90 days trading horizon Awilco LNG ASA is expected to under-perform the Okeanis Eco. In addition to that, Awilco LNG is 1.17 times more volatile than Okeanis Eco Tankers. It trades about -0.12 of its total potential returns per unit of risk. Okeanis Eco Tankers is currently generating about 0.02 per unit of volatility. If you would invest  24,250  in Okeanis Eco Tankers on November 28, 2024 and sell it today you would earn a total of  400.00  from holding Okeanis Eco Tankers or generate 1.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Awilco LNG ASA  vs.  Okeanis Eco Tankers

Awilco LNG ASA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Awilco LNG ASA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in March 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Okeanis Eco Tankers

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Okeanis Eco Tankers are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Okeanis Eco is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Awilco LNG and Okeanis Eco

The main advantage of trading using opposite Awilco LNG and Okeanis Eco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Awilco LNG position performs unexpectedly, Okeanis Eco 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 Okeanis Eco will offset losses from the drop in Okeanis Eco's long position.

The idea behind Awilco LNG ASA and Okeanis Eco Tankers pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.