Correlation Between SEACOR Marine and Hapag Lloyd

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

By analyzing existing cross correlation between SEACOR Marine Holdings and Hapag Lloyd Aktiengesellschaft, you can compare the effects of market volatilities on SEACOR Marine and Hapag Lloyd 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 SEACOR Marine with a short position of Hapag Lloyd. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEACOR Marine and Hapag Lloyd.

Diversification Opportunities for SEACOR Marine and Hapag Lloyd

0.19

Correlation Coefficient

SEACOR Marine  Hapag Lloyd

Average diversification

The 3 months correlation between SEACOR and Hapag is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding SEACOR Marine Holdings and Hapag Lloyd Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hapag Lloyd Aktienge and SEACOR Marine 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 SEACOR Marine Holdings are associated (or correlated) with Hapag Lloyd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hapag Lloyd Aktienge has no effect on the direction of SEACOR Marine i.e., SEACOR Marine and Hapag Lloyd go up and down completely randomly.

Pair Corralation between SEACOR Marine and Hapag Lloyd

Given the investment horizon of 90 days SEACOR Marine Holdings is expected to under-perform the Hapag Lloyd. In addition to that, SEACOR Marine is 2.21 times more volatile than Hapag Lloyd Aktiengesellschaft. It trades about -0.09 of its total potential returns per unit of risk. Hapag Lloyd Aktiengesellschaft is currently generating about 0.06 per unit of volatility. If you would invest  8,074  in Hapag Lloyd Aktiengesellschaft on September 28, 2024 and sell it today you would earn a total of  162.00  from holding Hapag Lloyd Aktiengesellschaft or generate 2.01% return on investment over 90 days.

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

SEACOR Marine Holdings  vs.  Hapag Lloyd Aktiengesellschaft

SEACOR Marine Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SEACOR Marine Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Hapag Lloyd Aktienge

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hapag Lloyd Aktiengesellschaft has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's essential indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with SEACOR Marine and Hapag Lloyd

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

The idea behind SEACOR Marine Holdings and Hapag Lloyd Aktiengesellschaft 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.