Correlation Between Asure Software and Allient

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

By analyzing existing cross correlation between Asure Software and Allient, you can compare the effects of market volatilities on Asure Software and Allient 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 Asure Software with a short position of Allient. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asure Software and Allient.

Diversification Opportunities for Asure Software and Allient

0.72

Correlation Coefficient

Asure Software  Allient

Poor diversification

The 3 months correlation between Asure and Allient is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and Allient in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allient and Asure Software 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 Asure Software are associated (or correlated) with Allient. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allient has no effect on the direction of Asure Software i.e., Asure Software and Allient go up and down completely randomly.

Pair Corralation between Asure Software and Allient

Given the investment horizon of 90 days Asure Software is expected to generate 1.21 times more return on investment than Allient. However, Asure Software is 1.21 times more volatile than Allient. It trades about 0.03 of its potential returns per unit of risk. Allient is currently generating about 0.0 per unit of risk. If you would invest  941.00  in Asure Software on December 29, 2024 and sell it today you would earn a total of  20.00  from holding Asure Software or generate 2.13% return on investment over 90 days.

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

Asure Software  vs.  Allient

Asure Software

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Asure Software are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Asure Software is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Allient

Risk-Adjusted Performance

Very Weak

Over the last 90 days Allient has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Allient is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Asure Software and Allient

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

The idea behind Asure Software and Allient 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.