Correlation Between Ball and International Paper
Can any of the company-specific risk be diversified away by investing in both Ball and International Paper 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 International Paper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ball Corporation and International Paper, you can compare the effects of market volatilities on Ball and International Paper 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 International Paper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ball and International Paper.
Diversification Opportunities for Ball and International Paper
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ball and International is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ball Corp. and International Paper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Paper 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 International Paper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Paper has no effect on the direction of Ball i.e., Ball and International Paper go up and down completely randomly.
Pair Corralation between Ball and International Paper
If you would invest 3,396 in International Paper on January 24, 2024 and sell it today you would earn a total of 45.00 from holding International Paper or generate 1.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Ball Corp. vs. International Paper
Performance |
Timeline |
Ball |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
International Paper |
Ball and International Paper Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ball and International Paper
The main advantage of trading using opposite Ball and International Paper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ball position performs unexpectedly, International Paper 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 International Paper will offset losses from the drop in International Paper's long position.Ball vs. Glacier Media | Ball vs. Skechers USA | Ball vs. UbiSoft Entertainment | Ball vs. Mannatech Incorporated |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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