Correlation Between Navios Maritime and Globus Maritime

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

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

Diversification Opportunities for Navios Maritime and Globus Maritime

0.13

Correlation Coefficient

Navios Maritime  Globus Maritime

Average diversification

The 3 months correlation between Navios and Globus is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Navios Maritime Partners and Globus Maritime in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globus Maritime and Navios 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 Navios Maritime Partners are associated (or correlated) with Globus Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globus Maritime has no effect on the direction of Navios Maritime i.e., Navios Maritime and Globus Maritime go up and down completely randomly.

Pair Corralation between Navios Maritime and Globus Maritime

Considering the 90-day investment horizon Navios Maritime Partners is expected to under-perform the Globus Maritime. But the stock apears to be less risky and, when comparing its historical volatility, Navios Maritime Partners is 1.57 times less risky than Globus Maritime. The stock trades about -0.07 of its potential returns per unit of risk. The Globus Maritime is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  116.00  in Globus Maritime on December 25, 2024 and sell it today you would earn a total of  8.00  from holding Globus Maritime or generate 6.9% return on investment over 90 days.

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

Navios Maritime Partners  vs.  Globus Maritime

Navios Maritime Partners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Navios Maritime Partners has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's primary indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Globus Maritime

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Globus Maritime are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak fundamental drivers, Globus Maritime may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Navios Maritime and Globus Maritime

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

The idea behind Navios Maritime Partners and Globus Maritime 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.