Correlation Between Asure Software and Newpark Resources
Can any of the company-specific risk be diversified away by investing in both Asure Software and Newpark Resources 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 Newpark Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asure Software and Newpark Resources, you can compare the effects of market volatilities on Asure Software and Newpark Resources 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 Newpark Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asure Software and Newpark Resources.
Diversification Opportunities for Asure Software and Newpark Resources
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Asure and Newpark is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and Newpark Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newpark Resources 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 Newpark Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newpark Resources has no effect on the direction of Asure Software i.e., Asure Software and Newpark Resources go up and down completely randomly.
Pair Corralation between Asure Software and Newpark Resources
Given the investment horizon of 90 days Asure Software is expected to generate 176.92 times less return on investment than Newpark Resources. In addition to that, Asure Software is 1.35 times more volatile than Newpark Resources. It trades about 0.0 of its total potential returns per unit of risk. Newpark Resources is currently generating about 0.09 per unit of volatility. If you would invest 422.00 in Newpark Resources on September 1, 2024 and sell it today you would earn a total of 414.00 from holding Newpark Resources or generate 98.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asure Software vs. Newpark Resources
Performance |
| Timeline |
| Asure Software |
| Newpark Resources |
Asure Software and Newpark Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asure Software and Newpark Resources
The main advantage of trading using opposite Asure Software and Newpark Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asure Software position performs unexpectedly, Newpark Resources 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 Newpark Resources will offset losses from the drop in Newpark Resources' long position.| Asure Software vs. Alkami Technology | Asure Software vs. Blackbaud | Asure Software vs. Enfusion | Asure Software vs. Clearwater Analytics Holdings |
| Newpark Resources vs. Enerflex | Newpark Resources vs. Now Inc | Newpark Resources vs. Bristow Group | Newpark Resources vs. Helix Energy Solutions |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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