Correlation Between ARDAGH METAL and CSL
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and CSL 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 CSL 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 CSL Limited, you can compare the effects of market volatilities on ARDAGH METAL and CSL 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 CSL. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and CSL.
Diversification Opportunities for ARDAGH METAL and CSL
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ARDAGH and CSL is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and CSL Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSL Limited 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 CSL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSL Limited has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and CSL go up and down completely randomly.
Pair Corralation between ARDAGH METAL and CSL
Assuming the 90 days horizon ARDAGH METAL PACDL 0001 is expected to generate 4.76 times more return on investment than CSL. However, ARDAGH METAL is 4.76 times more volatile than CSL Limited. It trades about 0.02 of its potential returns per unit of risk. CSL Limited is currently generating about -0.04 per unit of risk. If you would invest 284.00 in ARDAGH METAL PACDL 0001 on October 21, 2024 and sell it today you would earn a total of 0.00 from holding ARDAGH METAL PACDL 0001 or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ARDAGH METAL PACDL 0001 vs. CSL Limited
Performance |
| Timeline |
| ARDAGH METAL PACDL |
| CSL Limited |
ARDAGH METAL and CSL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ARDAGH METAL and CSL
The main advantage of trading using opposite ARDAGH METAL and CSL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, CSL 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 CSL will offset losses from the drop in CSL's long position.| ARDAGH METAL vs. Mitsui Chemicals | ARDAGH METAL vs. CHEMICAL INDUSTRIES | ARDAGH METAL vs. AIR PRODCHEMICALS | ARDAGH METAL vs. Transport International Holdings |
| CSL vs. Novo Nordisk AS | CSL vs. CSL LTD SPONADR | CSL vs. Mercedes Benz Group AG | CSL vs. Vertex Pharmaceuticals Incorporated |
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.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |