Correlation Between Castor Maritime and SOS

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

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

Diversification Opportunities for Castor Maritime and SOS

0.58

Correlation Coefficient

Castor Maritime  SOS

Very weak diversification

The 3 months correlation between Castor and SOS is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Castor Maritime and SOS Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOS Limited and Castor 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 Castor Maritime are associated (or correlated) with SOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOS Limited has no effect on the direction of Castor Maritime i.e., Castor Maritime and SOS go up and down completely randomly.

Pair Corralation between Castor Maritime and SOS

Given the investment horizon of 90 days Castor Maritime is expected to generate 5.77 times less return on investment than SOS. But when comparing it to its historical volatility, Castor Maritime is 2.38 times less risky than SOS. It trades about 0.04 of its potential returns per unit of risk. SOS Limited is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  468.00  in SOS Limited on May 1, 2025 and sell it today you would earn a total of  132.00  from holding SOS Limited or generate 28.21% return on investment over 90 days.

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

Castor Maritime  vs.  SOS Limited

Castor Maritime

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Castor Maritime are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Castor Maritime may actually be approaching a critical reversion point that can send shares even higher in August 2025.

SOS Limited

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SOS Limited are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, SOS unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Castor Maritime and SOS

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

The idea behind Castor Maritime and SOS Limited 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.