Correlation Between Okeanis Eco and Klaveness Combination

Can any of the company-specific risk be diversified away by investing in both Okeanis Eco and Klaveness Combination 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 Okeanis Eco and Klaveness Combination into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Okeanis Eco Tankers and Klaveness Combination Carriers, you can compare the effects of market volatilities on Okeanis Eco and Klaveness Combination 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 Okeanis Eco with a short position of Klaveness Combination. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okeanis Eco and Klaveness Combination.

Diversification Opportunities for Okeanis Eco and Klaveness Combination

-0.28

Correlation Coefficient

Okeanis Eco  Klaveness Combination

Very good diversification

The 3 months correlation between Okeanis and Klaveness is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Okeanis Eco Tankers and Klaveness Combination Carriers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klaveness Combination and Okeanis Eco 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 Okeanis Eco Tankers are associated (or correlated) with Klaveness Combination. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klaveness Combination has no effect on the direction of Okeanis Eco i.e., Okeanis Eco and Klaveness Combination go up and down completely randomly.

Pair Corralation between Okeanis Eco and Klaveness Combination

Assuming the 90 days trading horizon Okeanis Eco is expected to generate 2.38 times less return on investment than Klaveness Combination. But when comparing it to its historical volatility, Okeanis Eco Tankers is 1.01 times less risky than Klaveness Combination. It trades about 0.13 of its potential returns per unit of risk. Klaveness Combination Carriers is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest  9,550  in Klaveness Combination Carriers on February 2, 2024 and sell it today you would earn a total of  1,270  from holding Klaveness Combination Carriers or generate 13.3% return on investment over 90 days.

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

Okeanis Eco Tankers  vs.  Klaveness Combination Carriers

Okeanis Eco Tankers

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Okeanis Eco Tankers are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Okeanis Eco disclosed solid returns over the last few months and may actually be approaching a breakup point.

Klaveness Combination

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Klaveness Combination Carriers has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental indicators, Klaveness Combination is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Okeanis Eco and Klaveness Combination

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

The idea behind Okeanis Eco Tankers and Klaveness Combination Carriers 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.