Correlation Between Cultural Investment and Aurora Optoelectronics
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By analyzing existing cross correlation between Cultural Investment Holdings and Aurora Optoelectronics Co, you can compare the effects of market volatilities on Cultural Investment and Aurora Optoelectronics 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 Cultural Investment with a short position of Aurora Optoelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cultural Investment and Aurora Optoelectronics.
Diversification Opportunities for Cultural Investment and Aurora Optoelectronics
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cultural and Aurora is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Cultural Investment Holdings and Aurora Optoelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Optoelectronics and Cultural Investment 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 Cultural Investment Holdings are associated (or correlated) with Aurora Optoelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Optoelectronics has no effect on the direction of Cultural Investment i.e., Cultural Investment and Aurora Optoelectronics go up and down completely randomly.
Pair Corralation between Cultural Investment and Aurora Optoelectronics
Assuming the 90 days trading horizon Cultural Investment is expected to generate 2.69 times less return on investment than Aurora Optoelectronics. But when comparing it to its historical volatility, Cultural Investment Holdings is 1.53 times less risky than Aurora Optoelectronics. It trades about 0.13 of its potential returns per unit of risk. Aurora Optoelectronics Co is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 140.00 in Aurora Optoelectronics Co on September 2, 2024 and sell it today you would earn a total of 110.00 from holding Aurora Optoelectronics Co or generate 78.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cultural Investment Holdings vs. Aurora Optoelectronics Co
Performance |
| Timeline |
| Cultural Investment |
| Aurora Optoelectronics |
Cultural Investment and Aurora Optoelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cultural Investment and Aurora Optoelectronics
The main advantage of trading using opposite Cultural Investment and Aurora Optoelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cultural Investment position performs unexpectedly, Aurora Optoelectronics 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 Aurora Optoelectronics will offset losses from the drop in Aurora Optoelectronics' long position.| Cultural Investment vs. China Minmetals Rare | Cultural Investment vs. Chengtun Mining Group | Cultural Investment vs. Qinghaihuading Industrial Co | Cultural Investment vs. China Life Insurance |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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