Correlation Between ARDAGH METAL and Orange SA
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and Orange SA 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 Orange SA 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 Orange SA, you can compare the effects of market volatilities on ARDAGH METAL and Orange SA 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 Orange SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and Orange SA.
Diversification Opportunities for ARDAGH METAL and Orange SA
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ARDAGH and Orange is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and Orange SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orange SA 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 Orange SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orange SA has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and Orange SA go up and down completely randomly.
Pair Corralation between ARDAGH METAL and Orange SA
Assuming the 90 days horizon ARDAGH METAL PACDL 0001 is expected to under-perform the Orange SA. In addition to that, ARDAGH METAL is 3.49 times more volatile than Orange SA. It trades about -0.07 of its total potential returns per unit of risk. Orange SA is currently generating about 0.1 per unit of volatility. If you would invest 983.00 in Orange SA on November 2, 2024 and sell it today you would earn a total of 57.00 from holding Orange SA or generate 5.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
ARDAGH METAL PACDL 0001 vs. Orange SA
Performance |
| Timeline |
| ARDAGH METAL PACDL |
| Orange SA |
ARDAGH METAL and Orange SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ARDAGH METAL and Orange SA
The main advantage of trading using opposite ARDAGH METAL and Orange SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, Orange SA 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 Orange SA will offset losses from the drop in Orange SA's long position.| ARDAGH METAL vs. Television Broadcasts Limited | ARDAGH METAL vs. NORWEGIAN AIR SHUT | ARDAGH METAL vs. Transport International Holdings | ARDAGH METAL vs. BROADSTNET LEADL 00025 |
| Orange SA vs. Inspire Medical Systems | Orange SA vs. Suntory Beverage Food | Orange SA vs. Genertec Universal Medical | Orange SA vs. Fevertree Drinks PLC |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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