Correlation Between ARDAGH METAL and Dillards

Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL and Dillards 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 Dillards 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 Dillards, you can compare the effects of market volatilities on ARDAGH METAL and Dillards 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 Dillards. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and Dillards.

Diversification Opportunities for ARDAGH METAL and Dillards

-0.25

Correlation Coefficient

ARDAGH METAL  Dillards

Very good diversification

The 3 months correlation between ARDAGH and Dillards is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 and Dillards in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dillards 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 Dillards. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dillards has no effect on the direction of ARDAGH METAL i.e., ARDAGH METAL and Dillards go up and down completely randomly.

Pair Corralation between ARDAGH METAL and Dillards

Assuming the 90 days horizon ARDAGH METAL PACDL 0001 is expected to generate 1.53 times more return on investment than Dillards. However, ARDAGH METAL is 1.53 times more volatile than Dillards. It trades about 0.01 of its potential returns per unit of risk. Dillards is currently generating about -0.12 per unit of risk. If you would invest  274.00  in ARDAGH METAL PACDL 0001 on December 25, 2024 and sell it today you would lose (6.00) from holding ARDAGH METAL PACDL 0001 or give up 2.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

ARDAGH METAL PACDL 0001  vs.  Dillards

ARDAGH METAL PACDL

Risk-Adjusted Performance

Very Weak

Over the last 90 days ARDAGH METAL PACDL 0001 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ARDAGH METAL is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Dillards

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dillards has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with ARDAGH METAL and Dillards

The main advantage of trading using opposite ARDAGH METAL and Dillards positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL position performs unexpectedly, Dillards 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 Dillards will offset losses from the drop in Dillards' long position.

The idea behind ARDAGH METAL PACDL 0001 and Dillards 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.

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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.