Correlation Between Auras Technology and TUL
Can any of the company-specific risk be diversified away by investing in both Auras Technology and TUL 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 Auras Technology and TUL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auras Technology Co and TUL Corporation, you can compare the effects of market volatilities on Auras Technology and TUL 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 Auras Technology with a short position of TUL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auras Technology and TUL.
Diversification Opportunities for Auras Technology and TUL
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Auras and TUL is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Auras Technology Co and TUL Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TUL Corporation and Auras Technology 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 Auras Technology Co are associated (or correlated) with TUL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TUL Corporation has no effect on the direction of Auras Technology i.e., Auras Technology and TUL go up and down completely randomly.
Pair Corralation between Auras Technology and TUL
Assuming the 90 days trading horizon Auras Technology Co is expected to generate 1.13 times more return on investment than TUL. However, Auras Technology is 1.13 times more volatile than TUL Corporation. It trades about 0.04 of its potential returns per unit of risk. TUL Corporation is currently generating about -0.03 per unit of risk. If you would invest 67,000 in Auras Technology Co on August 31, 2024 and sell it today you would earn a total of 1,200 from holding Auras Technology Co or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auras Technology Co vs. TUL Corp.
Performance |
| Timeline |
| Auras Technology |
| TUL Corporation |
Auras Technology and TUL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auras Technology and TUL
The main advantage of trading using opposite Auras Technology and TUL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auras Technology position performs unexpectedly, TUL 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 TUL will offset losses from the drop in TUL's long position.| Auras Technology vs. Louisa Professional Coffee | Auras Technology vs. Shanghai Commercial Savings | Auras Technology vs. Univacco Technology | Auras Technology vs. Wei Chuan Foods |
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Check out your portfolio center.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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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