Correlation Between Aurora Optoelectronics and Songz Automobile
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By analyzing existing cross correlation between Aurora Optoelectronics Co and Songz Automobile Air, you can compare the effects of market volatilities on Aurora Optoelectronics and Songz Automobile 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 Aurora Optoelectronics with a short position of Songz Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Optoelectronics and Songz Automobile.
Diversification Opportunities for Aurora Optoelectronics and Songz Automobile
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aurora and Songz is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Optoelectronics Co and Songz Automobile Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Songz Automobile Air and Aurora Optoelectronics 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 Aurora Optoelectronics Co are associated (or correlated) with Songz Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Songz Automobile Air has no effect on the direction of Aurora Optoelectronics i.e., Aurora Optoelectronics and Songz Automobile go up and down completely randomly.
Pair Corralation between Aurora Optoelectronics and Songz Automobile
Assuming the 90 days trading horizon Aurora Optoelectronics Co is expected to under-perform the Songz Automobile. In addition to that, Aurora Optoelectronics is 1.89 times more volatile than Songz Automobile Air. It trades about -0.4 of its total potential returns per unit of risk. Songz Automobile Air is currently generating about -0.29 per unit of volatility. If you would invest 708.00 in Songz Automobile Air on October 14, 2024 and sell it today you would lose (84.00) from holding Songz Automobile Air or give up 11.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurora Optoelectronics Co vs. Songz Automobile Air
Performance |
| Timeline |
| Aurora Optoelectronics |
| Songz Automobile Air |
Aurora Optoelectronics and Songz Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Optoelectronics and Songz Automobile
The main advantage of trading using opposite Aurora Optoelectronics and Songz Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Optoelectronics position performs unexpectedly, Songz Automobile 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 Songz Automobile will offset losses from the drop in Songz Automobile's long position.| Aurora Optoelectronics vs. China Longyuan Power | Aurora Optoelectronics vs. PetroChina Co Ltd | Aurora Optoelectronics vs. Guangxi Guiguan Electric | Aurora Optoelectronics vs. Yantai North Andre |
| Songz Automobile vs. Aurora Optoelectronics Co | Songz Automobile vs. Ningbo Kangqiang Electronics | Songz Automobile vs. Anhui Gujing Distillery | Songz Automobile vs. Leyard Optoelectronic |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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