Correlation Between ARDAGH METAL and INSURANCE AUST
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and INSURANCE AUST 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 ARDAGH METAL and INSURANCE AUST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ARDAGH METAL PACDL 0001 and INSURANCE AUST GRP, you can compare the effects of market volatilities on ARDAGH METAL and INSURANCE AUST 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 ARDAGH METAL with a short position of INSURANCE AUST. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and INSURANCE AUST.
Diversification Opportunities for ARDAGH METAL and INSURANCE AUST
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between ARDAGH and INSURANCE is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and INSURANCE AUST GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INSURANCE AUST GRP and ARDAGH METAL 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 ARDAGH METAL PACDL 0001 are associated (or correlated) with INSURANCE AUST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INSURANCE AUST GRP has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and INSURANCE AUST go up and down completely randomly.
Pair Corralation between ARDAGH METAL and INSURANCE AUST
Assuming the 90 days horizon ARDAGH METAL PACDL 0001 is expected to under-perform the INSURANCE AUST. In addition to that, ARDAGH METAL is 2.24 times more volatile than INSURANCE AUST GRP. It trades about -0.03 of its total potential returns per unit of risk. INSURANCE AUST GRP is currently generating about 0.12 per unit of volatility. If you would invest 444.00 in INSURANCE AUST GRP on September 24, 2024 and sell it today you would earn a total of 52.00 from holding INSURANCE AUST GRP or generate 11.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ARDAGH METAL PACDL 0001 vs. INSURANCE AUST GRP
Performance |
Timeline |
ARDAGH METAL PACDL |
INSURANCE AUST GRP |
ARDAGH METAL and INSURANCE AUST Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ARDAGH METAL and INSURANCE AUST
The main advantage of trading using opposite ARDAGH METAL and INSURANCE AUST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, INSURANCE AUST 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 INSURANCE AUST will offset losses from the drop in INSURANCE AUST's long position.ARDAGH METAL vs. Electronic Arts | ARDAGH METAL vs. BJs Wholesale Club | ARDAGH METAL vs. National Retail Properties | ARDAGH METAL vs. Meiko Electronics Co |
INSURANCE AUST vs. Cleanaway Waste Management | INSURANCE AUST vs. ARDAGH METAL PACDL 0001 | INSURANCE AUST vs. Corporate Travel Management | INSURANCE AUST vs. Yuexiu Transport Infrastructure |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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