Correlation Between Ainsworth Game and Harley Davidson

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

Diversification Opportunities for Ainsworth Game and Harley Davidson

0.0

Correlation Coefficient

Ainsworth Game  Harley Davidson

Pay attention - limited upside

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

Pair Corralation between Ainsworth Game and Harley Davidson

Assuming the 90 days horizon Ainsworth Game Technology is expected to under-perform the Harley Davidson. In addition to that, Ainsworth Game is 1.49 times more volatile than Harley Davidson. It trades about -0.04 of its total potential returns per unit of risk. Harley Davidson is currently generating about -0.04 per unit of volatility. If you would invest  3,354  in Harley Davidson on October 22, 2024 and sell it today you would lose (450.00) from holding Harley Davidson or give up 13.42% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.2%
Values	Daily Returns

Ainsworth Game Technology  vs.  Harley Davidson

Ainsworth Game Technology

Risk-Adjusted Performance

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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.

Harley Davidson

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Harley Davidson has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Ainsworth Game and Harley Davidson

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

The idea behind Ainsworth Game Technology and Harley Davidson 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.