Correlation Between Ball and Ardagh Metal
Can any of the company-specific risk be diversified away by investing in both Ball and Ardagh Metal 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 Ball and Ardagh Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ball Corporation and Ardagh Metal Packaging, you can compare the effects of market volatilities on Ball and Ardagh Metal 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 Ball with a short position of Ardagh Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ball and Ardagh Metal.
Diversification Opportunities for Ball and Ardagh Metal
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ball and Ardagh is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Ball Corp. and Ardagh Metal Packaging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ardagh Metal Packaging and Ball 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 Ball Corporation are associated (or correlated) with Ardagh Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ardagh Metal Packaging has no effect on the direction of Ball i.e., Ball and Ardagh Metal go up and down completely randomly.
Pair Corralation between Ball and Ardagh Metal
Given the investment horizon of 90 days Ball Corporation is expected to under-perform the Ardagh Metal. But the stock apears to be less risky and, when comparing its historical volatility, Ball Corporation is 1.61 times less risky than Ardagh Metal. The stock trades about -0.07 of its potential returns per unit of risk. The Ardagh Metal Packaging is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 377.00 in Ardagh Metal Packaging on July 20, 2025 and sell it today you would lose (2.00) from holding Ardagh Metal Packaging or give up 0.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ball Corp. vs. Ardagh Metal Packaging
Performance |
| Timeline |
| Ball |
| Ardagh Metal Packaging |
Ball and Ardagh Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ball and Ardagh Metal
The main advantage of trading using opposite Ball and Ardagh Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ball position performs unexpectedly, Ardagh Metal 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 Ardagh Metal will offset losses from the drop in Ardagh Metal's long position.The idea behind Ball Corporation and Ardagh Metal Packaging pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Ardagh Metal vs. Ball Corporation | Ardagh Metal vs. Myers Industries | Ardagh Metal vs. Reynolds Consumer Products | Ardagh Metal vs. Greif Bros |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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