Correlation Between Ainsworth Game and Norfolk Southern
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Norfolk Southern 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 Norfolk Southern 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 Norfolk Southern, you can compare the effects of market volatilities on Ainsworth Game and Norfolk Southern 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 Norfolk Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Norfolk Southern.
Diversification Opportunities for Ainsworth Game and Norfolk Southern
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ainsworth and Norfolk is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Norfolk Southern in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norfolk Southern 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 Norfolk Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norfolk Southern has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Norfolk Southern go up and down completely randomly.
Pair Corralation between Ainsworth Game and Norfolk Southern
Assuming the 90 days horizon Ainsworth Game Technology is expected to under-perform the Norfolk Southern. In addition to that, Ainsworth Game is 1.85 times more volatile than Norfolk Southern. It trades about -0.01 of its total potential returns per unit of risk. Norfolk Southern is currently generating about 0.02 per unit of volatility. If you would invest 24,234 in Norfolk Southern on September 3, 2024 and sell it today you would earn a total of 3,351 from holding Norfolk Southern or generate 13.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Norfolk Southern
Performance |
| Timeline |
| Ainsworth Game Technology |
| Norfolk Southern |
Ainsworth Game and Norfolk Southern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Norfolk Southern
The main advantage of trading using opposite Ainsworth Game and Norfolk Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Norfolk Southern 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 Norfolk Southern will offset losses from the drop in Norfolk Southern's long position.| Ainsworth Game vs. Intema Solutions | Ainsworth Game vs. 888 Holdings | Ainsworth Game vs. Royal Wins | Ainsworth Game vs. Real Luck 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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