Correlation Between Crown Holdings and Amcor PLC
Can any of the company-specific risk be diversified away by investing in both Crown Holdings and Amcor PLC 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 Crown Holdings and Amcor PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crown Holdings and Amcor PLC, you can compare the effects of market volatilities on Crown Holdings and Amcor PLC 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 Crown Holdings with a short position of Amcor PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crown Holdings and Amcor PLC.
Diversification Opportunities for Crown Holdings and Amcor PLC
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Crown and Amcor is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Crown Holdings and Amcor PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amcor PLC and Crown Holdings 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 Crown Holdings are associated (or correlated) with Amcor PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amcor PLC has no effect on the direction of Crown Holdings i.e., Crown Holdings and Amcor PLC go up and down completely randomly.
Pair Corralation between Crown Holdings and Amcor PLC
Considering the 90-day investment horizon Crown Holdings is expected to generate 0.46 times more return on investment than Amcor PLC. However, Crown Holdings is 2.17 times less risky than Amcor PLC. It trades about -0.1 of its potential returns per unit of risk. Amcor PLC is currently generating about -0.08 per unit of risk. If you would invest 9,482 in Crown Holdings on August 28, 2024 and sell it today you would lose (220.00) from holding Crown Holdings or give up 2.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Crown Holdings vs. Amcor PLC
Performance |
| Timeline |
| Crown Holdings |
| Amcor PLC |
Crown Holdings and Amcor PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crown Holdings and Amcor PLC
The main advantage of trading using opposite Crown Holdings and Amcor PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crown Holdings position performs unexpectedly, Amcor PLC 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 Amcor PLC will offset losses from the drop in Amcor PLC's long position.| Crown Holdings vs. Amcor PLC | Crown Holdings vs. Avery Dennison Corp | Crown Holdings vs. Packaging Corp of | Crown Holdings vs. Sealed Air |
| Amcor PLC vs. Crown Holdings | Amcor PLC vs. Avery Dennison Corp | Amcor PLC vs. Packaging Corp of | Amcor PLC vs. Sealed Air |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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