Correlation Between HAPAG-LLOYD UNSPADR and AP Møller

Can any of the company-specific risk be diversified away by investing in both HAPAG-LLOYD UNSPADR and AP Møller 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 HAPAG-LLOYD UNSPADR and AP Møller into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between HAPAG LLOYD UNSPADR 12 and AP Mller , you can compare the effects of market volatilities on HAPAG-LLOYD UNSPADR and AP Møller 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 HAPAG-LLOYD UNSPADR with a short position of AP Møller. Check out your portfolio center. Please also check ongoing floating volatility patterns of HAPAG-LLOYD UNSPADR and AP Møller.

Diversification Opportunities for HAPAG-LLOYD UNSPADR and AP Møller

0.67

Correlation Coefficient

HAPAG-LLOYD UNSPADR  AP Møller

Poor diversification

The 3 months correlation between HAPAG-LLOYD and DP4B is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding HAPAG LLOYD UNSPADR 12 and AP Mller in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Møller and HAPAG-LLOYD UNSPADR 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 HAPAG LLOYD UNSPADR 12 are associated (or correlated) with AP Møller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Møller has no effect on the direction of HAPAG-LLOYD UNSPADR i.e., HAPAG-LLOYD UNSPADR and AP Møller go up and down completely randomly.

Pair Corralation between HAPAG-LLOYD UNSPADR and AP Møller

Assuming the 90 days trading horizon HAPAG LLOYD UNSPADR 12 is expected to under-perform the AP Møller. In addition to that, HAPAG-LLOYD UNSPADR is 1.26 times more volatile than AP Mller . It trades about -0.03 of its total potential returns per unit of risk. AP Mller is currently generating about 0.08 per unit of volatility. If you would invest  139,568  in AP Mller on December 23, 2024 and sell it today you would earn a total of  15,932  from holding AP Mller or generate 11.42% return on investment over 90 days.

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

HAPAG LLOYD UNSPADR 12  vs.  AP Mller

HAPAG LLOYD UNSPADR

Risk-Adjusted Performance

Very Weak

Over the last 90 days HAPAG LLOYD UNSPADR 12 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

AP Møller

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in AP Mller are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, AP Møller reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HAPAG-LLOYD UNSPADR and AP Møller

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

The idea behind HAPAG LLOYD UNSPADR 12 and AP Mller 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.