Correlation Between Pyxis Tankers and Safe Bulkers

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

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

Diversification Opportunities for Pyxis Tankers and Safe Bulkers

-0.16

Correlation Coefficient

Pyxis Tankers  Safe Bulkers

Good diversification

The 3 months correlation between Pyxis and Safe is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Pyxis Tankers and Safe Bulkers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safe Bulkers and Pyxis Tankers 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 Pyxis Tankers are associated (or correlated) with Safe Bulkers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safe Bulkers has no effect on the direction of Pyxis Tankers i.e., Pyxis Tankers and Safe Bulkers go up and down completely randomly.

Pair Corralation between Pyxis Tankers and Safe Bulkers

Assuming the 90 days horizon Pyxis Tankers is expected to under-perform the Safe Bulkers. In addition to that, Pyxis Tankers is 26.07 times more volatile than Safe Bulkers. It trades about -0.09 of its total potential returns per unit of risk. Safe Bulkers is currently generating about 0.03 per unit of volatility. If you would invest  2,500  in Safe Bulkers on December 3, 2024 and sell it today you would earn a total of  25.00  from holding Safe Bulkers or generate 1.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	67.8%
Values	Daily Returns

Pyxis Tankers  vs.  Safe Bulkers

Pyxis Tankers

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pyxis Tankers has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Safe Bulkers

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Safe Bulkers are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Safe Bulkers is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Pyxis Tankers and Safe Bulkers

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

The idea behind Pyxis Tankers and Safe Bulkers 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.