Correlation Between Ainsworth Game and ENQLN

Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and ENQLN 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 Ainsworth Game and ENQLN into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ainsworth Game Technology and ENQLN 11625 01 NOV 27, you can compare the effects of market volatilities on Ainsworth Game and ENQLN 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 Ainsworth Game with a short position of ENQLN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and ENQLN.

Diversification Opportunities for Ainsworth Game and ENQLN

0.27

Correlation Coefficient

Ainsworth Game  ENQLN

Modest diversification

The 3 months correlation between Ainsworth and ENQLN is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and ENQLN 11625 01 NOV 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENQLN 11625 01 and Ainsworth Game 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 Ainsworth Game Technology are associated (or correlated) with ENQLN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENQLN 11625 01 has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and ENQLN go up and down completely randomly.

Pair Corralation between Ainsworth Game and ENQLN

Assuming the 90 days horizon Ainsworth Game Technology is expected to generate 5.9 times more return on investment than ENQLN. However, Ainsworth Game is 5.9 times more volatile than ENQLN 11625 01 NOV 27. It trades about -0.02 of its potential returns per unit of risk. ENQLN 11625 01 NOV 27 is currently generating about -0.27 per unit of risk. If you would invest  55.00  in Ainsworth Game Technology on September 13, 2024 and sell it today you would lose (4.00) from holding Ainsworth Game Technology or give up 7.27% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	47.62%
Values	Daily Returns

Ainsworth Game Technology  vs.  ENQLN 11625 01 NOV 27

Ainsworth Game Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ainsworth Game Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ainsworth Game is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

ENQLN 11625 01

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ENQLN 11625 01 NOV 27 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for ENQLN 11625 01 NOV 27 investors.

Pair Trading with Ainsworth Game and ENQLN

The main advantage of trading using opposite Ainsworth Game and ENQLN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, ENQLN 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 ENQLN will offset losses from the drop in ENQLN's long position.

The idea behind Ainsworth Game Technology and ENQLN 11625 01 NOV 27 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.