Correlation Between Pyxis Tankers and Navios Maritime

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

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

Diversification Opportunities for Pyxis Tankers and Navios Maritime

0.88

Correlation Coefficient

Pyxis Tankers  Navios Maritime

Very poor diversification

The 3 months correlation between Pyxis and Navios is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Pyxis Tankers and Navios Maritime Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Navios Maritime Partners 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 Navios Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Navios Maritime Partners has no effect on the direction of Pyxis Tankers i.e., Pyxis Tankers and Navios Maritime go up and down completely randomly.

Pair Corralation between Pyxis Tankers and Navios Maritime

Considering the 90-day investment horizon Pyxis Tankers is expected to generate 6.92 times less return on investment than Navios Maritime. But when comparing it to its historical volatility, Pyxis Tankers is 1.09 times less risky than Navios Maritime. It trades about 0.02 of its potential returns per unit of risk. Navios Maritime Partners is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  2,236  in Navios Maritime Partners on September 12, 2024 and sell it today you would earn a total of  2,268  from holding Navios Maritime Partners or generate 101.41% return on investment over 90 days.

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

Pyxis Tankers  vs.  Navios Maritime Partners

Pyxis Tankers

Risk-Adjusted Performance

0 of 100

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 weak performance in the last few months, the Stock's basic indicators 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.

Navios Maritime Partners

Risk-Adjusted Performance

0 of 100

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 weak performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Pyxis Tankers and Navios Maritime

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

The idea behind Pyxis Tankers and Navios Maritime Partners 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.