Correlation Between O I and Ball

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

By analyzing existing cross correlation between O I Glass and Ball Corporation, you can compare the effects of market volatilities on O I and Ball 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 O I with a short position of Ball. Check out your portfolio center. Please also check ongoing floating volatility patterns of O I and Ball.

Diversification Opportunities for O I and Ball

0.42

Correlation Coefficient

O I  Ball

Very weak diversification

The 3 months correlation between O I and Ball is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding O I Glass and Ball Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ball and O I 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 O I Glass are associated (or correlated) with Ball. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ball has no effect on the direction of O I i.e., O I and Ball go up and down completely randomly.

Pair Corralation between O I and Ball

Allowing for the 90-day total investment horizon O I Glass is expected to generate 1.32 times more return on investment than Ball. However, O I is 1.32 times more volatile than Ball Corporation. It trades about -0.07 of its potential returns per unit of risk. Ball Corporation is currently generating about -0.16 per unit of risk. If you would invest  1,273  in O I Glass on December 2, 2024 and sell it today you would lose (126.00) from holding O I Glass or give up 9.9% of portfolio value over 90 days.

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

O I Glass  vs.  Ball Corp.

O I Glass

Risk-Adjusted Performance

Very Weak

Over the last 90 days O I Glass has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's forward indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Ball

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ball Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with O I and Ball

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

The idea behind O I Glass and Ball Corporation 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.