Correlation Between Westpac Banking and Ainsworth Game
Can any of the company-specific risk be diversified away by investing in both Westpac Banking 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 Westpac Banking and Ainsworth Game into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westpac Banking and Ainsworth Game Technology, you can compare the effects of market volatilities on Westpac Banking 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 Westpac Banking with a short position of Ainsworth Game. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westpac Banking and Ainsworth Game.
Diversification Opportunities for Westpac Banking and Ainsworth Game
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Westpac and Ainsworth is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Westpac Banking 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 Westpac Banking 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 Westpac Banking 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 Westpac Banking i.e., Westpac Banking and Ainsworth Game go up and down completely randomly.
Pair Corralation between Westpac Banking and Ainsworth Game
Assuming the 90 days trading horizon Westpac Banking is expected to generate 0.07 times more return on investment than Ainsworth Game. However, Westpac Banking is 14.67 times less risky than Ainsworth Game. It trades about 0.05 of its potential returns per unit of risk. Ainsworth Game Technology is currently generating about -0.01 per unit of risk. If you would invest 9,495 in Westpac Banking on September 3, 2024 and sell it today you would earn a total of 537.00 from holding Westpac Banking or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Westpac Banking vs. Ainsworth Game Technology
Performance |
| Timeline |
| Westpac Banking |
| Ainsworth Game Technology |
Westpac Banking and Ainsworth Game Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westpac Banking and Ainsworth Game
The main advantage of trading using opposite Westpac Banking and Ainsworth Game positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westpac Banking 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.| Westpac Banking vs. Kip McGrath Education | Westpac Banking vs. Alto Metals | Westpac Banking vs. Leeuwin Metals | Westpac Banking vs. Centaurus Metals |
| 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 CEOs Directory module to screen CEOs from public companies around the world.
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