Correlation Between Ainsworth Game and Talisman Mining
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Talisman Mining 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 Talisman Mining 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 Talisman Mining, you can compare the effects of market volatilities on Ainsworth Game and Talisman Mining 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 Talisman Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Talisman Mining.
Diversification Opportunities for Ainsworth Game and Talisman Mining
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ainsworth and Talisman is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Talisman Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talisman Mining 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 Talisman Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talisman Mining has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Talisman Mining go up and down completely randomly.
Pair Corralation between Ainsworth Game and Talisman Mining
Assuming the 90 days trading horizon Ainsworth Game Technology is expected to under-perform the Talisman Mining. But the stock apears to be less risky and, when comparing its historical volatility, Ainsworth Game Technology is 1.92 times less risky than Talisman Mining. The stock trades about -0.04 of its potential returns per unit of risk. The Talisman Mining is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 21.00 in Talisman Mining on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Talisman Mining or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Talisman Mining
Performance |
| Timeline |
| Ainsworth Game Technology |
| Talisman Mining |
Ainsworth Game and Talisman Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Talisman Mining
The main advantage of trading using opposite Ainsworth Game and Talisman Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Talisman Mining 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 Talisman Mining will offset losses from the drop in Talisman Mining's long position.| Ainsworth Game vs. Westpac Banking | Ainsworth Game vs. Champion Iron | Ainsworth Game vs. iShares Global Healthcare | Ainsworth Game vs. Peel Mining |
| Talisman Mining vs. Northern Star Resources | Talisman Mining vs. Evolution Mining | Talisman Mining vs. Bluescope Steel | Talisman Mining vs. Aneka Tambang Tbk |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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