Correlation Between Genco Shipping and AOYAMA TRADING
Can any of the company-specific risk be diversified away by investing in both Genco Shipping and AOYAMA TRADING 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 Genco Shipping and AOYAMA TRADING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genco Shipping Trading and AOYAMA TRADING, you can compare the effects of market volatilities on Genco Shipping and AOYAMA TRADING 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 Genco Shipping with a short position of AOYAMA TRADING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genco Shipping and AOYAMA TRADING.
Diversification Opportunities for Genco Shipping and AOYAMA TRADING
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Genco and AOYAMA is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Genco Shipping Trading and AOYAMA TRADING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AOYAMA TRADING and Genco Shipping 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 Genco Shipping Trading are associated (or correlated) with AOYAMA TRADING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AOYAMA TRADING has no effect on the direction of Genco Shipping i.e., Genco Shipping and AOYAMA TRADING go up and down completely randomly.
Pair Corralation between Genco Shipping and AOYAMA TRADING
Assuming the 90 days trading horizon Genco Shipping Trading is expected to generate 1.75 times more return on investment than AOYAMA TRADING. However, Genco Shipping is 1.75 times more volatile than AOYAMA TRADING. It trades about -0.05 of its potential returns per unit of risk. AOYAMA TRADING is currently generating about -0.13 per unit of risk. If you would invest 1,384 in Genco Shipping Trading on December 1, 2024 and sell it today you would lose (28.00) from holding Genco Shipping Trading or give up 2.02% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Genco Shipping Trading vs. AOYAMA TRADING
Performance |
Timeline |
Genco Shipping Trading |
AOYAMA TRADING |
Genco Shipping and AOYAMA TRADING Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Genco Shipping and AOYAMA TRADING
The main advantage of trading using opposite Genco Shipping and AOYAMA TRADING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genco Shipping position performs unexpectedly, AOYAMA TRADING 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 AOYAMA TRADING will offset losses from the drop in AOYAMA TRADING's long position.Genco Shipping vs. WILLIS LEASE FIN | Genco Shipping vs. COSMOSTEEL HLDGS | Genco Shipping vs. SWISS WATER DECAFFCOFFEE | Genco Shipping vs. ANGANG STEEL H |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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