Correlation Between Global Ship and Harsco

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

By analyzing existing cross correlation between Global Ship Lease and Harsco 575 percent, you can compare the effects of market volatilities on Global Ship and Harsco 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 Global Ship with a short position of Harsco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and Harsco.

Diversification Opportunities for Global Ship and Harsco

-0.05

Correlation Coefficient

Global Ship  Harsco

Good diversification

The 3 months correlation between Global and Harsco is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and Harsco 575 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harsco 575 percent and Global Ship 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 Global Ship Lease are associated (or correlated) with Harsco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harsco 575 percent has no effect on the direction of Global Ship i.e., Global Ship and Harsco go up and down completely randomly.

Pair Corralation between Global Ship and Harsco

Assuming the 90 days trading horizon Global Ship is expected to generate 50.15 times less return on investment than Harsco. But when comparing it to its historical volatility, Global Ship Lease is 58.33 times less risky than Harsco. It trades about 0.05 of its potential returns per unit of risk. Harsco 575 percent is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  8,561  in Harsco 575 percent on October 3, 2024 and sell it today you would earn a total of  42.00  from holding Harsco 575 percent or generate 0.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	90.1%
Values	Daily Returns

Global Ship Lease  vs.  Harsco 575 percent

Global Ship Lease

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Global Ship Lease has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong essential indicators, Global Ship is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Harsco 575 percent

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Harsco 575 percent has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for Harsco 575 percent investors.

Pair Trading with Global Ship and Harsco

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

The idea behind Global Ship Lease and Harsco 575 percent 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.