Correlation Between Costamare and Seanergy Maritime

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

By analyzing existing cross correlation between Costamare and Seanergy Maritime Holdings, you can compare the effects of market volatilities on Costamare and Seanergy Maritime 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 Costamare with a short position of Seanergy Maritime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Costamare and Seanergy Maritime.

Diversification Opportunities for Costamare and Seanergy Maritime

-0.02

Correlation Coefficient

Costamare  Seanergy Maritime

Good diversification

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

Pair Corralation between Costamare and Seanergy Maritime

Assuming the 90 days trading horizon Costamare is expected to generate 0.34 times more return on investment than Seanergy Maritime. However, Costamare is 2.96 times less risky than Seanergy Maritime. It trades about 0.07 of its potential returns per unit of risk. Seanergy Maritime Holdings is currently generating about -0.04 per unit of risk. If you would invest  2,542  in Costamare on December 4, 2024 and sell it today you would earn a total of  72.00  from holding Costamare or generate 2.83% return on investment over 90 days.

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

Costamare  vs.  Seanergy Maritime Holdings

Costamare

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Costamare are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, Costamare is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Seanergy Maritime

Risk-Adjusted Performance

Very Weak

Over the last 90 days Seanergy Maritime Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, Seanergy Maritime is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Costamare and Seanergy Maritime

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

The idea behind Costamare and Seanergy Maritime Holdings 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.