Correlation Between ARDAGH METAL and Intel
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and Intel 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 Intel 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 Intel, you can compare the effects of market volatilities on ARDAGH METAL and Intel 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 Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and Intel.
Diversification Opportunities for ARDAGH METAL and Intel
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ARDAGH and Intel is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel 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 Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and Intel go up and down completely randomly.
Pair Corralation between ARDAGH METAL and Intel
Assuming the 90 days horizon ARDAGH METAL is expected to generate 3.88 times less return on investment than Intel. But when comparing it to its historical volatility, ARDAGH METAL PACDL 0001 is 1.07 times less risky than Intel. It trades about 0.05 of its potential returns per unit of risk. Intel is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,992 in Intel on September 1, 2024 and sell it today you would earn a total of 260.00 from holding Intel or generate 13.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ARDAGH METAL PACDL 0001 vs. Intel
Performance |
| Timeline |
| ARDAGH METAL PACDL |
| Intel |
ARDAGH METAL and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ARDAGH METAL and Intel
The main advantage of trading using opposite ARDAGH METAL and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| ARDAGH METAL vs. Charter Communications | ARDAGH METAL vs. Cogent Communications Holdings | ARDAGH METAL vs. Computershare Limited | ARDAGH METAL vs. Verizon Communications |
| Intel vs. PARKEN Sport Entertainment | Intel vs. ARDAGH METAL PACDL 0001 | Intel vs. Columbia Sportswear | Intel vs. POWER METALS |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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