Correlation Between Castor Maritime and EnLink Midstream

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

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

Diversification Opportunities for Castor Maritime and EnLink Midstream

-0.04

Correlation Coefficient

Castor Maritime  EnLink Midstream

Good diversification

The 3 months correlation between Castor and EnLink is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Castor Maritime and EnLink Midstream LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EnLink Midstream LLC and Castor Maritime 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 Castor Maritime are associated (or correlated) with EnLink Midstream. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EnLink Midstream LLC has no effect on the direction of Castor Maritime i.e., Castor Maritime and EnLink Midstream go up and down completely randomly.

Pair Corralation between Castor Maritime and EnLink Midstream

Given the investment horizon of 90 days Castor Maritime is expected to under-perform the EnLink Midstream. In addition to that, Castor Maritime is 2.47 times more volatile than EnLink Midstream LLC. It trades about -0.02 of its total potential returns per unit of risk. EnLink Midstream LLC is currently generating about 0.02 per unit of volatility. If you would invest  1,323  in EnLink Midstream LLC on September 28, 2024 and sell it today you would earn a total of  99.50  from holding EnLink Midstream LLC or generate 7.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.63%
Values	Daily Returns

Castor Maritime  vs.  EnLink Midstream LLC

Castor Maritime

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Castor Maritime has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

EnLink Midstream LLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EnLink Midstream LLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound essential indicators, EnLink Midstream is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Castor Maritime and EnLink Midstream

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

The idea behind Castor Maritime and EnLink Midstream LLC 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.