Correlation Between Ainsworth Game and Telstra
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Telstra 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 Telstra 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 Telstra, you can compare the effects of market volatilities on Ainsworth Game and Telstra 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 Telstra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Telstra.
Diversification Opportunities for Ainsworth Game and Telstra
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ainsworth and Telstra is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Telstra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telstra 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 Telstra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telstra has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Telstra go up and down completely randomly.
Pair Corralation between Ainsworth Game and Telstra
Assuming the 90 days trading horizon Ainsworth Game Technology is expected to under-perform the Telstra. In addition to that, Ainsworth Game is 6.17 times more volatile than Telstra. It trades about -0.08 of its total potential returns per unit of risk. Telstra is currently generating about 0.0 per unit of volatility. If you would invest 400.00 in Telstra on October 18, 2024 and sell it today you would earn a total of 0.00 from holding Telstra or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Telstra
Performance |
| Timeline |
| Ainsworth Game Technology |
| Telstra |
Ainsworth Game and Telstra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Telstra
The main advantage of trading using opposite Ainsworth Game and Telstra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Telstra 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 Telstra will offset losses from the drop in Telstra's long position.| Ainsworth Game vs. Nufarm Finance NZ | Ainsworth Game vs. ABACUS STORAGE KING | Ainsworth Game vs. Queste Communications | Ainsworth Game vs. Kneomedia |
| Telstra vs. Ainsworth Game Technology | Telstra vs. Super Retail Group | Telstra vs. Sandon Capital Investments | Telstra vs. Qbe Insurance Group |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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