Correlation Between Star Bulk and Mitsui OSK
Can any of the company-specific risk be diversified away by investing in both Star Bulk and Mitsui OSK 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 Star Bulk and Mitsui OSK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Star Bulk Carriers and Mitsui OSK Lines, you can compare the effects of market volatilities on Star Bulk and Mitsui OSK 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 Star Bulk with a short position of Mitsui OSK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Star Bulk and Mitsui OSK.
Diversification Opportunities for Star Bulk and Mitsui OSK
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Star and Mitsui is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Star Bulk Carriers and Mitsui OSK Lines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsui OSK Lines and Star Bulk 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 Star Bulk Carriers are associated (or correlated) with Mitsui OSK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsui OSK Lines has no effect on the direction of Star Bulk i.e., Star Bulk and Mitsui OSK go up and down completely randomly.
Pair Corralation between Star Bulk and Mitsui OSK
Given the investment horizon of 90 days Star Bulk Carriers is expected to under-perform the Mitsui OSK. In addition to that, Star Bulk is 1.01 times more volatile than Mitsui OSK Lines. It trades about -0.16 of its total potential returns per unit of risk. Mitsui OSK Lines is currently generating about 0.06 per unit of volatility. If you would invest 1,607 in Mitsui OSK Lines on September 11, 2024 and sell it today you would earn a total of 92.00 from holding Mitsui OSK Lines or generate 5.72% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Star Bulk Carriers vs. Mitsui OSK Lines
Performance |
Timeline |
Star Bulk Carriers |
Mitsui OSK Lines |
Star Bulk and Mitsui OSK Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Star Bulk and Mitsui OSK
The main advantage of trading using opposite Star Bulk and Mitsui OSK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Star Bulk position performs unexpectedly, Mitsui OSK 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 Mitsui OSK will offset losses from the drop in Mitsui OSK's long position.Star Bulk vs. Genco Shipping Trading | Star Bulk vs. Diana Shipping | Star Bulk vs. Danaos | Star Bulk vs. Golden Ocean Group |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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