Correlation Between Ainsworth Game and Nufarm Finance
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Nufarm 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 Ainsworth Game and Nufarm Finance 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 Nufarm Finance NZ, you can compare the effects of market volatilities on Ainsworth Game and Nufarm 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 Ainsworth Game with a short position of Nufarm Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Nufarm Finance.
Diversification Opportunities for Ainsworth Game and Nufarm Finance
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ainsworth and Nufarm is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Nufarm Finance NZ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nufarm Finance NZ 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 Nufarm Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nufarm Finance NZ has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Nufarm Finance go up and down completely randomly.
Pair Corralation between Ainsworth Game and Nufarm Finance
Assuming the 90 days trading horizon Ainsworth Game Technology is expected to under-perform the Nufarm Finance. In addition to that, Ainsworth Game is 4.61 times more volatile than Nufarm Finance NZ. It trades about -0.23 of its total potential returns per unit of risk. Nufarm Finance NZ is currently generating about -0.05 per unit of volatility. If you would invest 9,380 in Nufarm Finance NZ on November 3, 2024 and sell it today you would lose (60.00) from holding Nufarm Finance NZ or give up 0.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Nufarm Finance NZ
Performance |
| Timeline |
| Ainsworth Game Technology |
| Nufarm Finance NZ |
Ainsworth Game and Nufarm Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Nufarm Finance
The main advantage of trading using opposite Ainsworth Game and Nufarm Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Nufarm 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 Nufarm Finance will offset losses from the drop in Nufarm Finance's long position.| Ainsworth Game vs. Super Retail Group | Ainsworth Game vs. Dalaroo Metals | Ainsworth Game vs. Dug Technology | Ainsworth Game vs. Computershare |
| Nufarm Finance vs. Aneka Tambang Tbk | Nufarm Finance vs. BHP Group Limited | Nufarm Finance vs. Ecofibre | Nufarm Finance vs. iShares Global Healthcare |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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