Correlation Between Brickworks and Ainsworth Game
Can any of the company-specific risk be diversified away by investing in both Brickworks and Ainsworth Game 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 Brickworks and Ainsworth Game into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brickworks and Ainsworth Game Technology, you can compare the effects of market volatilities on Brickworks and Ainsworth Game 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 Brickworks with a short position of Ainsworth Game. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brickworks and Ainsworth Game.
Diversification Opportunities for Brickworks and Ainsworth Game
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Brickworks and Ainsworth is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Brickworks and Ainsworth Game Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ainsworth Game Technology and Brickworks 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 Brickworks are associated (or correlated) with Ainsworth Game. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ainsworth Game Technology has no effect on the direction of Brickworks i.e., Brickworks and Ainsworth Game go up and down completely randomly.
Pair Corralation between Brickworks and Ainsworth Game
Assuming the 90 days trading horizon Brickworks is expected to under-perform the Ainsworth Game. But the stock apears to be less risky and, when comparing its historical volatility, Brickworks is 2.37 times less risky than Ainsworth Game. The stock trades about -0.08 of its potential returns per unit of risk. The Ainsworth Game Technology is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 70.00 in Ainsworth Game Technology on September 3, 2024 and sell it today you would earn a total of 5.00 from holding Ainsworth Game Technology or generate 7.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brickworks vs. Ainsworth Game Technology
Performance |
| Timeline |
| Brickworks |
| Ainsworth Game Technology |
Brickworks and Ainsworth Game Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brickworks and Ainsworth Game
The main advantage of trading using opposite Brickworks and Ainsworth Game positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brickworks position performs unexpectedly, Ainsworth Game 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 Ainsworth Game will offset losses from the drop in Ainsworth Game's long position.| Brickworks vs. Ainsworth Game Technology | Brickworks vs. Advanced Braking Technology | Brickworks vs. Queste Communications | Brickworks vs. Australian Unity Office |
| Ainsworth Game vs. Westpac Banking | Ainsworth Game vs. Champion Iron | Ainsworth Game vs. iShares Global Healthcare | Ainsworth Game vs. Peel Mining |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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