Correlation Between Grow Solutions and Austin Engineering

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

By analyzing existing cross correlation between Grow Solutions Holdings and Austin Engineering Limited, you can compare the effects of market volatilities on Grow Solutions and Austin Engineering 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 Grow Solutions with a short position of Austin Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grow Solutions and Austin Engineering.

Diversification Opportunities for Grow Solutions and Austin Engineering

0.0

Correlation Coefficient

Grow Solutions  Austin Engineering

Pay attention - limited upside

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

Pair Corralation between Grow Solutions and Austin Engineering

If you would invest  30.00  in Austin Engineering Limited on November 28, 2024 and sell it today you would lose (1.00) from holding Austin Engineering Limited or give up 3.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	92.06%
Values	Daily Returns

Grow Solutions Holdings  vs.  Austin Engineering Limited

Grow Solutions Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Grow Solutions Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Grow Solutions is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Austin Engineering

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Austin Engineering Limited are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent basic indicators, Austin Engineering may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Grow Solutions and Austin Engineering

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

The idea behind Grow Solutions Holdings and Austin Engineering Limited 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.