Correlation Between USWE SPORTS and ARDAGH METAL
Can any of the company-specific risk be diversified away by investing in both USWE SPORTS and ARDAGH METAL 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 USWE SPORTS and ARDAGH METAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USWE SPORTS AB and ARDAGH METAL PACDL 0001, you can compare the effects of market volatilities on USWE SPORTS and ARDAGH METAL 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 USWE SPORTS with a short position of ARDAGH METAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of USWE SPORTS and ARDAGH METAL.
Diversification Opportunities for USWE SPORTS and ARDAGH METAL
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between USWE and ARDAGH is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding USWE SPORTS AB and ARDAGH METAL PACDL 0001 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ARDAGH METAL PACDL and USWE SPORTS 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 USWE SPORTS AB are associated (or correlated) with ARDAGH METAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ARDAGH METAL PACDL has no effect on the direction of USWE SPORTS i.e., USWE SPORTS and ARDAGH METAL go up and down completely randomly.
Pair Corralation between USWE SPORTS and ARDAGH METAL
Assuming the 90 days horizon USWE SPORTS AB is expected to generate 0.63 times more return on investment than ARDAGH METAL. However, USWE SPORTS AB is 1.58 times less risky than ARDAGH METAL. It trades about 0.26 of its potential returns per unit of risk. ARDAGH METAL PACDL 0001 is currently generating about -0.07 per unit of risk. If you would invest 75.00 in USWE SPORTS AB on November 3, 2024 and sell it today you would earn a total of 11.00 from holding USWE SPORTS AB or generate 14.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
USWE SPORTS AB vs. ARDAGH METAL PACDL 0001
Performance |
| Timeline |
| USWE SPORTS AB |
| ARDAGH METAL PACDL |
USWE SPORTS and ARDAGH METAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USWE SPORTS and ARDAGH METAL
The main advantage of trading using opposite USWE SPORTS and ARDAGH METAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USWE SPORTS position performs unexpectedly, ARDAGH METAL 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 ARDAGH METAL will offset losses from the drop in ARDAGH METAL's long position.| USWE SPORTS vs. OPKO HEALTH | USWE SPORTS vs. Planet Fitness | USWE SPORTS vs. OPERA SOFTWARE | USWE SPORTS vs. Phibro Animal Health |
| ARDAGH METAL vs. Packaging of | ARDAGH METAL vs. Crown Holdings | ARDAGH METAL vs. CCL Industries | ARDAGH METAL vs. AptarGroup |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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