Correlation Between Globus Maritime and Safe Bulkers

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

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

Diversification Opportunities for Globus Maritime and Safe Bulkers

0.84

Correlation Coefficient

Globus Maritime  Safe Bulkers

Very poor diversification

The 3 months correlation between Globus and Safe is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Globus Maritime and Safe Bulkers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safe Bulkers and Globus 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 Globus Maritime 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 Globus Maritime i.e., Globus Maritime and Safe Bulkers go up and down completely randomly.

Pair Corralation between Globus Maritime and Safe Bulkers

Given the investment horizon of 90 days Globus Maritime is expected to under-perform the Safe Bulkers. In addition to that, Globus Maritime is 1.99 times more volatile than Safe Bulkers. It trades about -0.11 of its total potential returns per unit of risk. Safe Bulkers is currently generating about -0.15 per unit of volatility. If you would invest  475.00  in Safe Bulkers on September 13, 2024 and sell it today you would lose (88.00) from holding Safe Bulkers or give up 18.53% of portfolio value over 90 days.

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

Globus Maritime  vs.  Safe Bulkers

Globus Maritime

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Globus Maritime has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental drivers remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Safe Bulkers

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Safe Bulkers 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 fundamental drivers remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Globus Maritime and Safe Bulkers

The main advantage of trading using opposite Globus Maritime and Safe Bulkers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globus Maritime 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 Globus Maritime 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.