Correlation Between Ainsworth Game and Awilco Drilling
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Awilco Drilling 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 Awilco Drilling 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 Awilco Drilling PLC, you can compare the effects of market volatilities on Ainsworth Game and Awilco Drilling 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 Awilco Drilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Awilco Drilling.
Diversification Opportunities for Ainsworth Game and Awilco Drilling
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ainsworth and Awilco is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Awilco Drilling PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Awilco Drilling PLC 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 Awilco Drilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Awilco Drilling PLC has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Awilco Drilling go up and down completely randomly.
Pair Corralation between Ainsworth Game and Awilco Drilling
Assuming the 90 days horizon Ainsworth Game Technology is expected to under-perform the Awilco Drilling. In addition to that, Ainsworth Game is 3.67 times more volatile than Awilco Drilling PLC. It trades about -0.09 of its total potential returns per unit of risk. Awilco Drilling PLC is currently generating about -0.21 per unit of volatility. If you would invest 197.00 in Awilco Drilling PLC on August 30, 2024 and sell it today you would lose (5.00) from holding Awilco Drilling PLC or give up 2.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Awilco Drilling PLC
Performance |
| Timeline |
| Ainsworth Game Technology |
| Awilco Drilling PLC |
Ainsworth Game and Awilco Drilling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Awilco Drilling
The main advantage of trading using opposite Ainsworth Game and Awilco Drilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Awilco Drilling 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 Awilco Drilling will offset losses from the drop in Awilco Drilling's long position.| Ainsworth Game vs. Light Wonder | Ainsworth Game vs. Nasdaq Inc | Ainsworth Game vs. Vertiv Holdings Co | Ainsworth Game vs. IONQ Inc |
| Awilco Drilling vs. Noble plc | Awilco Drilling vs. Transocean | Awilco Drilling vs. Helmerich and Payne | Awilco Drilling vs. Patterson UTI Energy |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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