Correlation Between Cellnex Telecom and Ball Corp
Can any of the company-specific risk be diversified away by investing in both Cellnex Telecom and Ball Corp 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 Cellnex Telecom and Ball Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cellnex Telecom SA and Ball Corp, you can compare the effects of market volatilities on Cellnex Telecom and Ball Corp 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 Cellnex Telecom with a short position of Ball Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cellnex Telecom and Ball Corp.
Diversification Opportunities for Cellnex Telecom and Ball Corp
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cellnex and Ball is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Cellnex Telecom SA and Ball Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ball Corp and Cellnex Telecom 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 Cellnex Telecom SA are associated (or correlated) with Ball Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ball Corp has no effect on the direction of Cellnex Telecom i.e., Cellnex Telecom and Ball Corp go up and down completely randomly.
Pair Corralation between Cellnex Telecom and Ball Corp
Assuming the 90 days trading horizon Cellnex Telecom SA is expected to under-perform the Ball Corp. In addition to that, Cellnex Telecom is 1.28 times more volatile than Ball Corp. It trades about -0.4 of its total potential returns per unit of risk. Ball Corp is currently generating about -0.31 per unit of volatility. If you would invest 5,775 in Ball Corp on October 9, 2024 and sell it today you would lose (358.00) from holding Ball Corp or give up 6.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cellnex Telecom SA vs. Ball Corp
Performance |
| Timeline |
| Cellnex Telecom SA |
| Ball Corp |
Cellnex Telecom and Ball Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cellnex Telecom and Ball Corp
The main advantage of trading using opposite Cellnex Telecom and Ball Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cellnex Telecom position performs unexpectedly, Ball Corp 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 Ball Corp will offset losses from the drop in Ball Corp's long position.| Cellnex Telecom vs. Orient Telecoms | Cellnex Telecom vs. Bankers Investment Trust | Cellnex Telecom vs. Sparebank 1 SR | Cellnex Telecom vs. Berner Kantonalbank AG |
| Ball Corp vs. Walmart | Ball Corp vs. BYD Co | Ball Corp vs. Volkswagen AG | Ball Corp vs. Volkswagen AG Non Vtg |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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