Correlation Between Asure Software and Federal Home
Can any of the company-specific risk be diversified away by investing in both Asure Software and Federal Home 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 Federal Home into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asure Software and Federal Home 530, you can compare the effects of market volatilities on Asure Software and Federal Home 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 Federal Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asure Software and Federal Home.
Diversification Opportunities for Asure Software and Federal Home
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Asure and Federal is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and Federal Home 530 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federal Home 530 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 Federal Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federal Home 530 has no effect on the direction of Asure Software i.e., Asure Software and Federal Home go up and down completely randomly.
Pair Corralation between Asure Software and Federal Home
Given the investment horizon of 90 days Asure Software is expected to generate 4.21 times less return on investment than Federal Home. But when comparing it to its historical volatility, Asure Software is 1.5 times less risky than Federal Home. It trades about 0.03 of its potential returns per unit of risk. Federal Home 530 is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 375.00 in Federal Home 530 on September 3, 2024 and sell it today you would earn a total of 1,186 from holding Federal Home 530 or generate 316.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asure Software vs. Federal Home 530
Performance |
| Timeline |
| Asure Software |
| Federal Home 530 |
Asure Software and Federal Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asure Software and Federal Home
The main advantage of trading using opposite Asure Software and Federal Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asure Software position performs unexpectedly, Federal Home 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 Federal Home will offset losses from the drop in Federal Home's long position.| Asure Software vs. Alkami Technology | Asure Software vs. Blackbaud | Asure Software vs. Enfusion | Asure Software vs. Clearwater Analytics Holdings |
| Federal Home vs. Federal Home Loan | Federal Home vs. Deckers Outdoor | Federal Home vs. TechnipFMC PLC | Federal Home vs. Singular Genomics Systems |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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