Correlation Between AMCOR PLC and Beta Finance

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Can any of the company-specific risk be diversified away by investing in both AMCOR PLC and Beta Finance 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 Beta Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMCOR PLC CDI and Beta Finance, you can compare the effects of market volatilities on AMCOR PLC and Beta Finance 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 Beta Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMCOR PLC and Beta Finance.

Diversification Opportunities for AMCOR PLC and Beta Finance

0.37
  Correlation Coefficient

Weak diversification

The 3 months correlation between AMCOR and Beta Finance is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding AMCOR PLC CDI 11 and Beta Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beta Finance 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 CDI are associated (or correlated) with Beta Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beta Finance has no effect on the direction of AMCOR PLC i.e., AMCOR PLC and Beta Finance go up and down completely randomly.

Pair Corralation between AMCOR PLC and Beta Finance

Assuming the 90 days trading horizon AMCOR PLC is expected to generate 53.26 times less return on investment than Beta Finance. But when comparing it to its historical volatility, AMCOR PLC CDI is 46.36 times less risky than Beta Finance. It trades about 0.05 of its potential returns per unit of risk. Beta Finance is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  0.00  in Beta Finance on August 31, 2022 and sell it today you would earn a total of  10.00  from holding Beta Finance or generate 9.223372036854776E16% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy67.0%
ValuesDaily Returns

AMCOR PLC CDI 11  vs.  Beta Finance

 Performance (%) 
       Timeline  
AMCOR PLC CDI 
AMCOR Performance
4 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in AMCOR PLC CDI are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, AMCOR PLC is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

AMCOR Price Channel

Beta Finance 
Beta Finance Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Beta Finance are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Beta Finance sustained solid returns over the last few months and may actually be approaching a breakup point.

Beta Finance Price Channel

AMCOR PLC and Beta Finance Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with AMCOR PLC and Beta Finance

The main advantage of trading using opposite AMCOR PLC and Beta Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMCOR PLC position performs unexpectedly, Beta Finance 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 Beta Finance will offset losses from the drop in Beta Finance's long position.
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The idea behind AMCOR PLC CDI and Beta Finance 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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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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