Correlation Between AptarGroup and Silgan Holdings

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

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

Diversification Opportunities for AptarGroup and Silgan Holdings

0.17

Correlation Coefficient

AptarGroup  Silgan Holdings

Average diversification

The 3 months correlation between AptarGroup and Silgan is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding AptarGroup and Silgan Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silgan Holdings and AptarGroup 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 AptarGroup are associated (or correlated) with Silgan Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silgan Holdings has no effect on the direction of AptarGroup i.e., AptarGroup and Silgan Holdings go up and down completely randomly.

Pair Corralation between AptarGroup and Silgan Holdings

Considering the 90-day investment horizon AptarGroup is expected to generate 0.68 times more return on investment than Silgan Holdings. However, AptarGroup is 1.48 times less risky than Silgan Holdings. It trades about 0.21 of its potential returns per unit of risk. Silgan Holdings is currently generating about -0.2 per unit of risk. If you would invest  14,022  in AptarGroup on February 2, 2024 and sell it today you would earn a total of  570.00  from holding AptarGroup or generate 4.07% return on investment over 90 days.

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

AptarGroup  vs.  Silgan Holdings

AptarGroup

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AptarGroup are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, AptarGroup may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Silgan Holdings

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Silgan Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Silgan Holdings is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with AptarGroup and Silgan Holdings

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

The idea behind AptarGroup and Silgan Holdings 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.