Correlation Between Smurfit Kappa and Ball
Can any of the company-specific risk be diversified away by investing in both Smurfit Kappa and Ball 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 Smurfit Kappa and Ball into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smurfit Kappa Group and Ball Corporation, you can compare the effects of market volatilities on Smurfit Kappa and Ball 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 Smurfit Kappa with a short position of Ball. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smurfit Kappa and Ball.
Diversification Opportunities for Smurfit Kappa and Ball
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Smurfit and Ball is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Smurfit Kappa Group and Ball Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ball and Smurfit Kappa 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 Smurfit Kappa Group are associated (or correlated) with Ball. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ball has no effect on the direction of Smurfit Kappa i.e., Smurfit Kappa and Ball go up and down completely randomly.
Pair Corralation between Smurfit Kappa and Ball
Assuming the 90 days horizon Smurfit Kappa Group is expected to generate 1.04 times more return on investment than Ball. However, Smurfit Kappa is 1.04 times more volatile than Ball Corporation. It trades about 0.14 of its potential returns per unit of risk. Ball Corporation is currently generating about -0.13 per unit of risk. If you would invest 5,200 in Smurfit Kappa Group on September 12, 2024 and sell it today you would earn a total of 261.00 from holding Smurfit Kappa Group or generate 5.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Smurfit Kappa Group vs. Ball Corp.
Performance |
| Timeline |
| Smurfit Kappa Group |
| Ball |
Smurfit Kappa and Ball Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smurfit Kappa and Ball
The main advantage of trading using opposite Smurfit Kappa and Ball positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smurfit Kappa position performs unexpectedly, Ball 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 Ball will offset losses from the drop in Ball's long position.| Smurfit Kappa vs. Sealed Air | Smurfit Kappa vs. Avery Dennison Corp | Smurfit Kappa vs. International Paper | Smurfit Kappa vs. Sonoco Products |
| Ball vs. Graphic Packaging Holding | Ball vs. Silgan Holdings | Ball vs. Sonoco Products | Ball vs. Reynolds Consumer Products |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |