Correlation Between ARDAGH METAL and SLR Investment
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and SLR Investment 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 SLR Investment 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 SLR Investment Corp, you can compare the effects of market volatilities on ARDAGH METAL and SLR Investment 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 SLR Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and SLR Investment.
Diversification Opportunities for ARDAGH METAL and SLR Investment
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ARDAGH and SLR is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and SLR Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLR Investment Corp 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 SLR Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLR Investment Corp has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and SLR Investment go up and down completely randomly.
Pair Corralation between ARDAGH METAL and SLR Investment
Assuming the 90 days horizon ARDAGH METAL is expected to generate 3.83 times less return on investment than SLR Investment. In addition to that, ARDAGH METAL is 3.12 times more volatile than SLR Investment Corp. It trades about 0.01 of its total potential returns per unit of risk. SLR Investment Corp is currently generating about 0.07 per unit of volatility. If you would invest 1,083 in SLR Investment Corp on August 31, 2024 and sell it today you would earn a total of 482.00 from holding SLR Investment Corp or generate 44.51% 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. SLR Investment Corp
Performance |
| Timeline |
| ARDAGH METAL PACDL |
| SLR Investment Corp |
ARDAGH METAL and SLR Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ARDAGH METAL and SLR Investment
The main advantage of trading using opposite ARDAGH METAL and SLR Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, SLR Investment 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 SLR Investment will offset losses from the drop in SLR Investment's long position.| ARDAGH METAL vs. KAUFMAN ET BROAD | ARDAGH METAL vs. GRIFFIN MINING LTD | ARDAGH METAL vs. Nishi Nippon Railroad Co | ARDAGH METAL vs. EVS Broadcast Equipment |
| SLR Investment vs. Astral Foods Limited | SLR Investment vs. Collins Foods Limited | SLR Investment vs. United Natural Foods | SLR Investment vs. GRIFFIN MINING LTD |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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