Correlation Between Aristocrat Leisure and OURGAME INTHOLDL-00005

Can any of the company-specific risk be diversified away by investing in both Aristocrat Leisure and OURGAME INTHOLDL-00005 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 Aristocrat Leisure and OURGAME INTHOLDL-00005 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aristocrat Leisure Limited and OURGAME INTHOLDL 00005, you can compare the effects of market volatilities on Aristocrat Leisure and OURGAME INTHOLDL-00005 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 Aristocrat Leisure with a short position of OURGAME INTHOLDL-00005. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aristocrat Leisure and OURGAME INTHOLDL-00005.

Diversification Opportunities for Aristocrat Leisure and OURGAME INTHOLDL-00005

0.0

Correlation Coefficient

Aristocrat Leisure  OURGAME INTHOLDL-00005

Pay attention - limited upside

The 3 months correlation between Aristocrat and OURGAME is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aristocrat Leisure Limited and OURGAME INTHOLDL 00005 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OURGAME INTHOLDL 00005 and Aristocrat Leisure 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 Aristocrat Leisure Limited are associated (or correlated) with OURGAME INTHOLDL-00005. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OURGAME INTHOLDL 00005 has no effect on the direction of Aristocrat Leisure i.e., Aristocrat Leisure and OURGAME INTHOLDL-00005 go up and down completely randomly.

Pair Corralation between Aristocrat Leisure and OURGAME INTHOLDL-00005

If you would invest  3,781  in Aristocrat Leisure Limited on October 7, 2024 and sell it today you would earn a total of  399.00  from holding Aristocrat Leisure Limited or generate 10.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	97.44%
Values	Daily Returns

Aristocrat Leisure Limited  vs.  OURGAME INTHOLDL 00005

Aristocrat Leisure

Risk-Adjusted Performance

16 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Aristocrat Leisure Limited are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Aristocrat Leisure reported solid returns over the last few months and may actually be approaching a breakup point.

OURGAME INTHOLDL 00005

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OURGAME INTHOLDL 00005 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, OURGAME INTHOLDL-00005 is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Aristocrat Leisure and OURGAME INTHOLDL-00005

The main advantage of trading using opposite Aristocrat Leisure and OURGAME INTHOLDL-00005 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aristocrat Leisure position performs unexpectedly, OURGAME INTHOLDL-00005 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 OURGAME INTHOLDL-00005 will offset losses from the drop in OURGAME INTHOLDL-00005's long position.

The idea behind Aristocrat Leisure Limited and OURGAME INTHOLDL 00005 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.