Correlation Between StealthGas and Stock Index
Can any of the company-specific risk be diversified away by investing in both StealthGas and Stock Index 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 StealthGas and Stock Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between StealthGas and Stock Index Fund, you can compare the effects of market volatilities on StealthGas and Stock Index 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 StealthGas with a short position of Stock Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of StealthGas and Stock Index.
Diversification Opportunities for StealthGas and Stock Index
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between StealthGas and Stock is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding StealthGas and Stock Index Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stock Index Fund and StealthGas 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 StealthGas are associated (or correlated) with Stock Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stock Index Fund has no effect on the direction of StealthGas i.e., StealthGas and Stock Index go up and down completely randomly.
Pair Corralation between StealthGas and Stock Index
Given the investment horizon of 90 days StealthGas is expected to under-perform the Stock Index. In addition to that, StealthGas is 2.45 times more volatile than Stock Index Fund. It trades about -0.17 of its total potential returns per unit of risk. Stock Index Fund is currently generating about -0.28 per unit of volatility. If you would invest 5,243 in Stock Index Fund on January 20, 2024 and sell it today you would lose (212.00) from holding Stock Index Fund or give up 4.04% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
StealthGas vs. Stock Index Fund
Performance |
Timeline |
StealthGas |
Stock Index Fund |
StealthGas and Stock Index Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with StealthGas and Stock Index
The main advantage of trading using opposite StealthGas and Stock Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if StealthGas position performs unexpectedly, Stock Index 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 Stock Index will offset losses from the drop in Stock Index's long position.StealthGas vs. Danaos | StealthGas vs. Global Ship Lease | StealthGas vs. Euroseas | StealthGas vs. Navios Maritime Partners |
Stock Index vs. Mid Cap Index | Stock Index vs. Mid Cap Strategic | Stock Index vs. Valic Company I | Stock Index vs. Small Cap Special |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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