Correlation Between Amcor PLC and Millennium Group

Can any of the company-specific risk be diversified away by investing in both Amcor PLC and Millennium Group 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 Amcor PLC and Millennium Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amcor PLC and Millennium Group International, you can compare the effects of market volatilities on Amcor PLC and Millennium Group 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 Amcor PLC with a short position of Millennium Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amcor PLC and Millennium Group.

Diversification Opportunities for Amcor PLC and Millennium Group

-0.37

Correlation Coefficient

Amcor PLC  Millennium Group

Very good diversification

The 3 months correlation between Amcor and Millennium is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Amcor PLC and Millennium Group International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Millennium Group Int and Amcor PLC 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 Amcor PLC are associated (or correlated) with Millennium Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Millennium Group Int has no effect on the direction of Amcor PLC i.e., Amcor PLC and Millennium Group go up and down completely randomly.

Pair Corralation between Amcor PLC and Millennium Group

Given the investment horizon of 90 days Amcor PLC is expected to generate 34.69 times less return on investment than Millennium Group. But when comparing it to its historical volatility, Amcor PLC is 11.45 times less risky than Millennium Group. It trades about 0.02 of its potential returns per unit of risk. Millennium Group International is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  139.00  in Millennium Group International on December 22, 2024 and sell it today you would earn a total of  24.00  from holding Millennium Group International or generate 17.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Amcor PLC  vs.  Millennium Group International

Amcor PLC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Amcor PLC are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, Amcor PLC is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Millennium Group Int

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Millennium Group International are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Millennium Group demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amcor PLC and Millennium Group

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

The idea behind Amcor PLC and Millennium Group International 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.

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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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.