Correlation Between Ainsworth Game and Kingboard Chemical
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Kingboard Chemical 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 Kingboard Chemical 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 Kingboard Chemical Holdings, you can compare the effects of market volatilities on Ainsworth Game and Kingboard Chemical 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 Kingboard Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Kingboard Chemical.
Diversification Opportunities for Ainsworth Game and Kingboard Chemical
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ainsworth and Kingboard is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Kingboard Chemical Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingboard Chemical 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 Kingboard Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingboard Chemical has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Kingboard Chemical go up and down completely randomly.
Pair Corralation between Ainsworth Game and Kingboard Chemical
Assuming the 90 days horizon Ainsworth Game Technology is expected to under-perform the Kingboard Chemical. In addition to that, Ainsworth Game is 2.23 times more volatile than Kingboard Chemical Holdings. It trades about -0.01 of its total potential returns per unit of risk. Kingboard Chemical Holdings is currently generating about -0.02 per unit of volatility. If you would invest 1,399 in Kingboard Chemical Holdings on November 5, 2024 and sell it today you would lose (234.00) from holding Kingboard Chemical Holdings or give up 16.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Kingboard Chemical Holdings
Performance |
| Timeline |
| Ainsworth Game Technology |
| Kingboard Chemical |
Ainsworth Game and Kingboard Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Kingboard Chemical
The main advantage of trading using opposite Ainsworth Game and Kingboard Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Kingboard Chemical 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 Kingboard Chemical will offset losses from the drop in Kingboard Chemical's long position.| Ainsworth Game vs. Intema Solutions | Ainsworth Game vs. 888 Holdings | Ainsworth Game vs. Royal Wins | Ainsworth Game vs. Real Luck Group |
| Kingboard Chemical vs. Saia Inc | Kingboard Chemical vs. Broadcom | Kingboard Chemical vs. Proficient Auto Logistics, | Kingboard Chemical vs. Globalfoundries |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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