Correlation Between Asure Software and China Health
Can any of the company-specific risk be diversified away by investing in both Asure Software and China Health 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 Asure Software and China Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asure Software and China Health Industries, you can compare the effects of market volatilities on Asure Software and China Health 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 Asure Software with a short position of China Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asure Software and China Health.
Diversification Opportunities for Asure Software and China Health
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asure and China is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and China Health Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Health Industries and Asure Software 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 Asure Software are associated (or correlated) with China Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Health Industries has no effect on the direction of Asure Software i.e., Asure Software and China Health go up and down completely randomly.
Pair Corralation between Asure Software and China Health
Given the investment horizon of 90 days Asure Software is expected to generate 0.44 times more return on investment than China Health. However, Asure Software is 2.3 times less risky than China Health. It trades about 0.05 of its potential returns per unit of risk. China Health Industries is currently generating about -0.13 per unit of risk. If you would invest 825.00 in Asure Software on September 30, 2024 and sell it today you would earn a total of 110.00 from holding Asure Software or generate 13.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Asure Software vs. China Health Industries
Performance |
Timeline |
Asure Software |
China Health Industries |
Asure Software and China Health Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Asure Software and China Health
The main advantage of trading using opposite Asure Software and China Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asure Software position performs unexpectedly, China Health 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 China Health will offset losses from the drop in China Health's long position.Asure Software vs. Dubber Limited | ||
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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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