Correlation Between Ainsworth Game and Canada Goose

Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Canada Goose 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 Canada Goose 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 Canada Goose Holdings, you can compare the effects of market volatilities on Ainsworth Game and Canada Goose 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 Canada Goose. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Canada Goose.

Diversification Opportunities for Ainsworth Game and Canada Goose

0.56

Correlation Coefficient

Ainsworth Game  Canada Goose

Very weak diversification

The 3 months correlation between Ainsworth and Canada is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Canada Goose Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canada Goose Holdings 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 Canada Goose. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canada Goose Holdings has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Canada Goose go up and down completely randomly.

Pair Corralation between Ainsworth Game and Canada Goose

Assuming the 90 days horizon Ainsworth Game Technology is expected to generate 1.16 times more return on investment than Canada Goose. However, Ainsworth Game is 1.16 times more volatile than Canada Goose Holdings. It trades about -0.02 of its potential returns per unit of risk. Canada Goose Holdings is currently generating about -0.07 per unit of risk. If you would invest  60.00  in Ainsworth Game Technology on October 13, 2024 and sell it today you would lose (9.00) from holding Ainsworth Game Technology or give up 15.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Ainsworth Game Technology  vs.  Canada Goose Holdings

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.

Canada Goose Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Canada Goose Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Ainsworth Game and Canada Goose

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

The idea behind Ainsworth Game Technology and Canada Goose Holdings 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.