Correlation Between Overseas Shipholding and 1847 Goedeker

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Can any of the company-specific risk be diversified away by investing in both Overseas Shipholding and 1847 Goedeker 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 Overseas Shipholding and 1847 Goedeker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Overseas Shipholding Group and 1847 Goedeker Inc, you can compare the effects of market volatilities on Overseas Shipholding and 1847 Goedeker 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 Overseas Shipholding with a short position of 1847 Goedeker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Overseas Shipholding and 1847 Goedeker.

Diversification Opportunities for Overseas Shipholding and 1847 Goedeker

0.41
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Overseas and 1847 Goedeker is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Overseas Shipholding Group and 1847 Goedeker Inc Commom Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1847 Goedeker Commom and Overseas Shipholding 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 Overseas Shipholding Group are associated (or correlated) with 1847 Goedeker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1847 Goedeker Commom has no effect on the direction of Overseas Shipholding i.e., Overseas Shipholding and 1847 Goedeker go up and down completely randomly.

Pair Corralation between Overseas Shipholding and 1847 Goedeker

Considering the 90-day investment horizon Overseas Shipholding Group is expected to under-perform the 1847 Goedeker. In addition to that, Overseas Shipholding is 1.02 times more volatile than 1847 Goedeker Inc. It trades about -0.04 of its total potential returns per unit of risk. 1847 Goedeker Inc is currently generating about 0.05 per unit of volatility. If you would invest  70.00  in 1847 Goedeker Inc on August 31, 2022 and sell it today you would earn a total of  1.00  from holding 1847 Goedeker Inc or generate 1.43% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy24.19%
ValuesDaily Returns

Overseas Shipholding Group  vs.  1847 Goedeker Inc Commom Stock

 Performance (%) 
       Timeline  
Overseas Shipholding 
Overseas Performance
0 of 100
Over the last 90 days Overseas Shipholding Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Overseas Shipholding is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Overseas Price Channel

1847 Goedeker Commom 
1847 Goedeker Performance
0 of 100
Over the last 90 days 1847 Goedeker Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather weak technical and fundamental indicators, 1847 Goedeker may actually be approaching a critical reversion point that can send shares even higher in December 2022.

Overseas Shipholding and 1847 Goedeker Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Overseas Shipholding and 1847 Goedeker

The main advantage of trading using opposite Overseas Shipholding and 1847 Goedeker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Overseas Shipholding position performs unexpectedly, 1847 Goedeker 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 1847 Goedeker will offset losses from the drop in 1847 Goedeker's long position.
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The idea behind Overseas Shipholding Group and 1847 Goedeker Inc 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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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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.

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