Correlation Between ARDAGH METAL and AIR CHINA
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and AIR CHINA 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 ARDAGH METAL and AIR CHINA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ARDAGH METAL PACDL 0001 and AIR CHINA LTD, you can compare the effects of market volatilities on ARDAGH METAL and AIR CHINA 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 ARDAGH METAL with a short position of AIR CHINA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and AIR CHINA.
Diversification Opportunities for ARDAGH METAL and AIR CHINA
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ARDAGH and AIR is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and AIR CHINA LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIR CHINA LTD and ARDAGH METAL 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 ARDAGH METAL PACDL 0001 are associated (or correlated) with AIR CHINA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIR CHINA LTD has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and AIR CHINA go up and down completely randomly.
Pair Corralation between ARDAGH METAL and AIR CHINA
Assuming the 90 days horizon ARDAGH METAL is expected to generate 1.62 times less return on investment than AIR CHINA. But when comparing it to its historical volatility, ARDAGH METAL PACDL 0001 is 1.18 times less risky than AIR CHINA. It trades about 0.08 of its potential returns per unit of risk. AIR CHINA LTD is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,060 in AIR CHINA LTD on September 11, 2025 and sell it today you would earn a total of 260.00 from holding AIR CHINA LTD or generate 24.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ARDAGH METAL PACDL 0001 vs. AIR CHINA LTD
Performance |
| Timeline |
| ARDAGH METAL PACDL |
| AIR CHINA LTD |
ARDAGH METAL and AIR CHINA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ARDAGH METAL and AIR CHINA
The main advantage of trading using opposite ARDAGH METAL and AIR CHINA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, AIR CHINA 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 CHINA will offset losses from the drop in AIR CHINA's long position.| ARDAGH METAL vs. Packaging of | ARDAGH METAL vs. Smurfit Kappa Group | ARDAGH METAL vs. NMI Holdings | ARDAGH METAL vs. Origin Agritech |
| AIR CHINA vs. NXP Semiconductors NV | AIR CHINA vs. ON SEMICONDUCTOR | AIR CHINA vs. CSSC Offshore Marine | AIR CHINA vs. COMPUTER MODELLING |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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