Correlation Between Aurora Optoelectronics and Semiconductor Manufacturing
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By analyzing existing cross correlation between Aurora Optoelectronics Co and Semiconductor Manufacturing Electronics, you can compare the effects of market volatilities on Aurora Optoelectronics and Semiconductor Manufacturing 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 Semiconductor Manufacturing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Optoelectronics and Semiconductor Manufacturing.
Diversification Opportunities for Aurora Optoelectronics and Semiconductor Manufacturing
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aurora and Semiconductor is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Optoelectronics Co and Semiconductor Manufacturing El in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semiconductor Manufacturing 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 Semiconductor Manufacturing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semiconductor Manufacturing has no effect on the direction of Aurora Optoelectronics i.e., Aurora Optoelectronics and Semiconductor Manufacturing go up and down completely randomly.
Pair Corralation between Aurora Optoelectronics and Semiconductor Manufacturing
Assuming the 90 days trading horizon Aurora Optoelectronics Co is expected to generate 1.29 times more return on investment than Semiconductor Manufacturing. However, Aurora Optoelectronics is 1.29 times more volatile than Semiconductor Manufacturing Electronics. It trades about 0.04 of its potential returns per unit of risk. Semiconductor Manufacturing Electronics is currently generating about 0.01 per unit of risk. If you would invest 215.00 in Aurora Optoelectronics Co on August 25, 2024 and sell it today you would earn a total of 52.00 from holding Aurora Optoelectronics Co or generate 24.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurora Optoelectronics Co vs. Semiconductor Manufacturing El
Performance |
| Timeline |
| Aurora Optoelectronics |
| Semiconductor Manufacturing |
Aurora Optoelectronics and Semiconductor Manufacturing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Optoelectronics and Semiconductor Manufacturing
The main advantage of trading using opposite Aurora Optoelectronics and Semiconductor Manufacturing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Optoelectronics position performs unexpectedly, Semiconductor Manufacturing 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 Semiconductor Manufacturing will offset losses from the drop in Semiconductor Manufacturing's long position.| Aurora Optoelectronics vs. Ming Yang Smart | Aurora Optoelectronics vs. 159681 | Aurora Optoelectronics vs. 159005 | Aurora Optoelectronics vs. Loctek Ergonomic Technology |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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