Correlation Between CCL Industries and Spin Master
Can any of the company-specific risk be diversified away by investing in both CCL Industries and Spin Master 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 CCL Industries and Spin Master into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CCL Industries and Spin Master Corp, you can compare the effects of market volatilities on CCL Industries and Spin Master 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 CCL Industries with a short position of Spin Master. Check out your portfolio center. Please also check ongoing floating volatility patterns of CCL Industries and Spin Master.
Diversification Opportunities for CCL Industries and Spin Master
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between CCL and Spin is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding CCL Industries and Spin Master Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spin Master Corp and CCL Industries 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 CCL Industries are associated (or correlated) with Spin Master. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spin Master Corp has no effect on the direction of CCL Industries i.e., CCL Industries and Spin Master go up and down completely randomly.
Pair Corralation between CCL Industries and Spin Master
Assuming the 90 days trading horizon CCL Industries is expected to under-perform the Spin Master. But the stock apears to be less risky and, when comparing its historical volatility, CCL Industries is 1.85 times less risky than Spin Master. The stock trades about -0.28 of its potential returns per unit of risk. The Spin Master Corp is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 3,306 in Spin Master Corp on August 29, 2024 and sell it today you would lose (63.00) from holding Spin Master Corp or give up 1.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CCL Industries vs. Spin Master Corp
Performance |
| Timeline |
| CCL Industries |
| Spin Master Corp |
CCL Industries and Spin Master Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CCL Industries and Spin Master
The main advantage of trading using opposite CCL Industries and Spin Master positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CCL Industries position performs unexpectedly, Spin Master 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 Spin Master will offset losses from the drop in Spin Master's long position.| CCL Industries vs. Stella Jones | CCL Industries vs. Gildan Activewear | CCL Industries vs. Toromont Industries | CCL Industries vs. Waste Connections |
| Spin Master vs. Kinaxis | Spin Master vs. Premium Brands Holdings | Spin Master vs. Gildan Activewear | Spin Master vs. CCL Industries |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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