Correlation Between First Ship and Northern Oil
Can any of the company-specific risk be diversified away by investing in both First Ship and Northern Oil 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 First Ship and Northern Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Ship Lease and Northern Oil Gas, you can compare the effects of market volatilities on First Ship and Northern Oil 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 First Ship with a short position of Northern Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Ship and Northern Oil.
Diversification Opportunities for First Ship and Northern Oil
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and Northern is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Ship Lease and Northern Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern Oil Gas and First Ship 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 First Ship Lease are associated (or correlated) with Northern Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern Oil Gas has no effect on the direction of First Ship i.e., First Ship and Northern Oil go up and down completely randomly.
Pair Corralation between First Ship and Northern Oil
If you would invest 2,536 in Northern Oil Gas on September 10, 2025 and sell it today you would lose (51.00) from holding Northern Oil Gas or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Ship Lease vs. Northern Oil Gas
Performance |
| Timeline |
| First Ship Lease |
| Northern Oil Gas |
First Ship and Northern Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Ship and Northern Oil
The main advantage of trading using opposite First Ship and Northern Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Ship position performs unexpectedly, Northern Oil 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 Northern Oil will offset losses from the drop in Northern Oil's long position.| First Ship vs. CITIC Telecom International | First Ship vs. Space Communication | First Ship vs. Candlewood Hotel | First Ship vs. RLJ Lodging Trust |
| Northern Oil vs. SM Energy Co | Northern Oil vs. Crescent Energy Co | Northern Oil vs. Civitas Resources | Northern Oil vs. Torm PLC Class |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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