Correlation Between CCL Industries and Smurfit Kappa
Can any of the company-specific risk be diversified away by investing in both CCL Industries and Smurfit Kappa 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 CCL Industries and Smurfit Kappa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CCL Industries and Smurfit Kappa Group, you can compare the effects of market volatilities on CCL Industries and Smurfit Kappa 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 CCL Industries with a short position of Smurfit Kappa. Check out your portfolio center. Please also check ongoing floating volatility patterns of CCL Industries and Smurfit Kappa.
Diversification Opportunities for CCL Industries and Smurfit Kappa
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CCL and Smurfit is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding CCL Industries and Smurfit Kappa Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smurfit Kappa Group and CCL Industries 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 CCL Industries are associated (or correlated) with Smurfit Kappa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smurfit Kappa Group has no effect on the direction of CCL Industries i.e., CCL Industries and Smurfit Kappa go up and down completely randomly.
Pair Corralation between CCL Industries and Smurfit Kappa
Assuming the 90 days horizon CCL Industries is expected to generate 0.6 times more return on investment than Smurfit Kappa. However, CCL Industries is 1.66 times less risky than Smurfit Kappa. It trades about -0.02 of its potential returns per unit of risk. Smurfit Kappa Group is currently generating about -0.04 per unit of risk. If you would invest 4,940 in CCL Industries on November 27, 2024 and sell it today you would lose (40.00) from holding CCL Industries or give up 0.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CCL Industries vs. Smurfit Kappa Group
Performance |
| Timeline |
| CCL Industries |
| Smurfit Kappa Group |
CCL Industries and Smurfit Kappa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CCL Industries and Smurfit Kappa
The main advantage of trading using opposite CCL Industries and Smurfit Kappa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CCL Industries position performs unexpectedly, Smurfit Kappa 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 Smurfit Kappa will offset losses from the drop in Smurfit Kappa's long position.| CCL Industries vs. BANKINTER ADR 2007 | CCL Industries vs. Discover Financial Services | CCL Industries vs. United Overseas Insurance | CCL Industries vs. Japan Tobacco |
| Smurfit Kappa vs. Monster Beverage Corp | Smurfit Kappa vs. United Breweries Co | Smurfit Kappa vs. CanSino Biologics | Smurfit Kappa vs. Tsingtao Brewery |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |