Correlation Between Eagle Bulk and Kirby

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

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

Diversification Opportunities for Eagle Bulk and Kirby

0.0

Correlation Coefficient

Eagle Bulk  Kirby

Pay attention - limited upside

The 3 months correlation between Eagle and Kirby is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Bulk Shipping and Kirby in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kirby and Eagle Bulk 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 Eagle Bulk Shipping are associated (or correlated) with Kirby. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kirby has no effect on the direction of Eagle Bulk i.e., Eagle Bulk and Kirby go up and down completely randomly.

Pair Corralation between Eagle Bulk and Kirby

If you would invest (100.00) in Eagle Bulk Shipping on December 27, 2024 and sell it today you would earn a total of  100.00  from holding Eagle Bulk Shipping or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Eagle Bulk Shipping  vs.  Kirby

Eagle Bulk Shipping

Risk-Adjusted Performance

Very Weak

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

Kirby

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kirby has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical and fundamental indicators, Kirby is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Eagle Bulk and Kirby

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

The idea behind Eagle Bulk Shipping and Kirby 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.