Correlation Between ARDAGH METAL and MYFAIR GOLD
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and MYFAIR GOLD 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 MYFAIR GOLD 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 MYFAIR GOLD P, you can compare the effects of market volatilities on ARDAGH METAL and MYFAIR GOLD 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 MYFAIR GOLD. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and MYFAIR GOLD.
Diversification Opportunities for ARDAGH METAL and MYFAIR GOLD
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ARDAGH and MYFAIR is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and MYFAIR GOLD P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYFAIR GOLD P 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 MYFAIR GOLD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYFAIR GOLD P has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and MYFAIR GOLD go up and down completely randomly.
Pair Corralation between ARDAGH METAL and MYFAIR GOLD
Assuming the 90 days horizon ARDAGH METAL PACDL 0001 is expected to generate 1.0 times more return on investment than MYFAIR GOLD. However, ARDAGH METAL PACDL 0001 is 1.0 times less risky than MYFAIR GOLD. It trades about 0.0 of its potential returns per unit of risk. MYFAIR GOLD P is currently generating about -0.03 per unit of risk. If you would invest 292.00 in ARDAGH METAL PACDL 0001 on October 18, 2024 and sell it today you would lose (30.00) from holding ARDAGH METAL PACDL 0001 or give up 10.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ARDAGH METAL PACDL 0001 vs. MYFAIR GOLD P
Performance |
| Timeline |
| ARDAGH METAL PACDL |
| MYFAIR GOLD P |
ARDAGH METAL and MYFAIR GOLD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ARDAGH METAL and MYFAIR GOLD
The main advantage of trading using opposite ARDAGH METAL and MYFAIR GOLD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, MYFAIR GOLD 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 MYFAIR GOLD will offset losses from the drop in MYFAIR GOLD's long position.| ARDAGH METAL vs. PLAY2CHILL SA ZY | ARDAGH METAL vs. Aristocrat Leisure Limited | ARDAGH METAL vs. SEALED AIR | ARDAGH METAL vs. Columbia Sportswear |
| MYFAIR GOLD vs. MTY Food Group | MYFAIR GOLD vs. INDOFOOD AGRI RES | MYFAIR GOLD vs. Fast Retailing Co | MYFAIR GOLD vs. CANON MARKETING JP |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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