Correlation Between Asure Software and Nates Food

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

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

Diversification Opportunities for Asure Software and Nates Food

0.1

Correlation Coefficient

Asure Software  Nates Food

Average diversification

The 3 months correlation between Asure and Nates is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and Nates Food Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nates Food 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 Nates Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nates Food has no effect on the direction of Asure Software i.e., Asure Software and Nates Food go up and down completely randomly.

Pair Corralation between Asure Software and Nates Food

Given the investment horizon of 90 days Asure Software is expected to generate 366.74 times less return on investment than Nates Food. But when comparing it to its historical volatility, Asure Software is 51.37 times less risky than Nates Food. It trades about 0.02 of its potential returns per unit of risk. Nates Food Co is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  0.05  in Nates Food Co on October 23, 2024 and sell it today you would lose (0.04) from holding Nates Food Co or give up 80.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Asure Software  vs.  Nates Food Co

Asure Software

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Asure Software are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Asure Software reported solid returns over the last few months and may actually be approaching a breakup point.

Nates Food

Risk-Adjusted Performance

28 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Nates Food Co are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile primary indicators, Nates Food exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Asure Software and Nates Food

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

The idea behind Asure Software and Nates Food Co 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.