Correlation Between CCL Industries and Interface

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

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

Diversification Opportunities for CCL Industries and Interface

0.6

Correlation Coefficient

CCL Industries  Interface

Poor diversification

The 3 months correlation between CCL and Interface is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding CCL Industries and Interface in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interface and CCL Industries 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 CCL Industries are associated (or correlated) with Interface. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interface has no effect on the direction of CCL Industries i.e., CCL Industries and Interface go up and down completely randomly.

Pair Corralation between CCL Industries and Interface

Assuming the 90 days horizon CCL Industries is expected to generate 0.67 times more return on investment than Interface. However, CCL Industries is 1.49 times less risky than Interface. It trades about 0.15 of its potential returns per unit of risk. Interface is currently generating about 0.09 per unit of risk. If you would invest  5,152  in CCL Industries on April 29, 2025 and sell it today you would earn a total of  603.00  from holding CCL Industries or generate 11.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

CCL Industries  vs.  Interface

CCL Industries

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CCL Industries are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental drivers, CCL Industries may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Interface

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Interface are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting essential indicators, Interface may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with CCL Industries and Interface

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

The idea behind CCL Industries and Interface 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.