Correlation Between Ashland Global and Air Products
Can any of the company-specific risk be diversified away by investing in both Ashland Global and Air Products 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 Ashland Global and Air Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashland Global Holdings and Air Products and, you can compare the effects of market volatilities on Ashland Global and Air Products 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 Ashland Global with a short position of Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashland Global and Air Products.
Diversification Opportunities for Ashland Global and Air Products
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ashland and Air is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Ashland Global Holdings and Air Products and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products and Ashland Global 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 Ashland Global Holdings are associated (or correlated) with Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products has no effect on the direction of Ashland Global i.e., Ashland Global and Air Products go up and down completely randomly.
Pair Corralation between Ashland Global and Air Products
Considering the 90-day investment horizon Ashland Global Holdings is expected to under-perform the Air Products. But the stock apears to be less risky and, when comparing its historical volatility, Ashland Global Holdings is 1.01 times less risky than Air Products. The stock trades about -0.03 of its potential returns per unit of risk. The Air Products and is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 29,684 in Air Products and on August 27, 2024 and sell it today you would earn a total of 3,499 from holding Air Products and or generate 11.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashland Global Holdings vs. Air Products and
Performance |
| Timeline |
| Ashland Global Holdings |
| Air Products |
Ashland Global and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashland Global and Air Products
The main advantage of trading using opposite Ashland Global and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashland Global position performs unexpectedly, Air Products 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 Air Products will offset losses from the drop in Air Products' long position.| Ashland Global vs. Minerals Technologies | Ashland Global vs. Oil Dri | Ashland Global vs. H B Fuller | Ashland Global vs. Northern Technologies |
| Air Products vs. PPG Industries | Air Products vs. Ecolab Inc | Air Products vs. Sherwin Williams Co | Air Products vs. LyondellBasell Industries NV |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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