Correlation Between Ainsworth Game and Collins Foods
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Collins Foods 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 Ainsworth Game and Collins Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ainsworth Game Technology and Collins Foods, you can compare the effects of market volatilities on Ainsworth Game and Collins Foods 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 Ainsworth Game with a short position of Collins Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Collins Foods.
Diversification Opportunities for Ainsworth Game and Collins Foods
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ainsworth and Collins is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Collins Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Collins Foods and Ainsworth Game 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 Ainsworth Game Technology are associated (or correlated) with Collins Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Collins Foods has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Collins Foods go up and down completely randomly.
Pair Corralation between Ainsworth Game and Collins Foods
Assuming the 90 days trading horizon Ainsworth Game Technology is expected to under-perform the Collins Foods. In addition to that, Ainsworth Game is 3.71 times more volatile than Collins Foods. It trades about -0.01 of its total potential returns per unit of risk. Collins Foods is currently generating about 0.09 per unit of volatility. If you would invest 842.00 in Collins Foods on August 29, 2024 and sell it today you would earn a total of 12.00 from holding Collins Foods or generate 1.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Collins Foods
Performance |
| Timeline |
| Ainsworth Game Technology |
| Collins Foods |
Ainsworth Game and Collins Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Collins Foods
The main advantage of trading using opposite Ainsworth Game and Collins Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Collins Foods 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 Collins Foods will offset losses from the drop in Collins Foods' long position.| Ainsworth Game vs. Australian Unity Office | Ainsworth Game vs. Actinogen Medical | Ainsworth Game vs. Centaurus Metals | Ainsworth Game vs. Homeco Daily Needs |
| Collins Foods vs. Summit Resources Limited | Collins Foods vs. Champion Iron | Collins Foods vs. Ridley | Collins Foods vs. Peel Mining |
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 the Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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