Correlation Between Aurora Optoelectronics and China Life
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By analyzing existing cross correlation between Aurora Optoelectronics Co and China Life Insurance, you can compare the effects of market volatilities on Aurora Optoelectronics and China Life 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 China Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Optoelectronics and China Life.
Diversification Opportunities for Aurora Optoelectronics and China Life
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aurora and China is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Optoelectronics Co and China Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Life Insurance 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 China Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Life Insurance has no effect on the direction of Aurora Optoelectronics i.e., Aurora Optoelectronics and China Life go up and down completely randomly.
Pair Corralation between Aurora Optoelectronics and China Life
Assuming the 90 days trading horizon Aurora Optoelectronics Co is expected to generate 2.23 times more return on investment than China Life. However, Aurora Optoelectronics is 2.23 times more volatile than China Life Insurance. It trades about 0.18 of its potential returns per unit of risk. China Life Insurance is currently generating about -0.16 per unit of risk. If you would invest 260.00 in Aurora Optoelectronics Co on September 15, 2024 and sell it today you would earn a total of 47.00 from holding Aurora Optoelectronics Co or generate 18.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurora Optoelectronics Co vs. China Life Insurance
Performance |
| Timeline |
| Aurora Optoelectronics |
| China Life Insurance |
Aurora Optoelectronics and China Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Optoelectronics and China Life
The main advantage of trading using opposite Aurora Optoelectronics and China Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Optoelectronics position performs unexpectedly, China Life 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 China Life will offset losses from the drop in China Life's long position.| Aurora Optoelectronics vs. China Life Insurance | Aurora Optoelectronics vs. CICC Fund Management | Aurora Optoelectronics vs. Chengdu Spaceon Electronics | Aurora Optoelectronics vs. China Asset Management |
| China Life vs. BYD Co Ltd | China Life vs. China Mobile Limited | China Life vs. Agricultural Bank of | China Life vs. Industrial and Commercial |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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