Correlation Between Dufu Tech and Aurelius Technologies
Can any of the company-specific risk be diversified away by investing in both Dufu Tech and Aurelius Technologies 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 Dufu Tech and Aurelius Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dufu Tech Corp and Aurelius Technologies Bhd, you can compare the effects of market volatilities on Dufu Tech and Aurelius Technologies 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 Dufu Tech with a short position of Aurelius Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dufu Tech and Aurelius Technologies.
Diversification Opportunities for Dufu Tech and Aurelius Technologies
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dufu and Aurelius is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Dufu Tech Corp and Aurelius Technologies Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurelius Technologies Bhd and Dufu Tech 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 Dufu Tech Corp are associated (or correlated) with Aurelius Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurelius Technologies Bhd has no effect on the direction of Dufu Tech i.e., Dufu Tech and Aurelius Technologies go up and down completely randomly.
Pair Corralation between Dufu Tech and Aurelius Technologies
Assuming the 90 days trading horizon Dufu Tech Corp is expected to under-perform the Aurelius Technologies. In addition to that, Dufu Tech is 1.12 times more volatile than Aurelius Technologies Bhd. It trades about -0.32 of its total potential returns per unit of risk. Aurelius Technologies Bhd is currently generating about -0.32 per unit of volatility. If you would invest 352.00 in Aurelius Technologies Bhd on November 3, 2024 and sell it today you would lose (37.00) from holding Aurelius Technologies Bhd or give up 10.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dufu Tech Corp vs. Aurelius Technologies Bhd
Performance |
| Timeline |
| Dufu Tech Corp |
| Aurelius Technologies Bhd |
Dufu Tech and Aurelius Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dufu Tech and Aurelius Technologies
The main advantage of trading using opposite Dufu Tech and Aurelius Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dufu Tech position performs unexpectedly, Aurelius Technologies 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 Aurelius Technologies will offset losses from the drop in Aurelius Technologies' long position.| Dufu Tech vs. Impiana Hotels Bhd | Dufu Tech vs. Petronas Chemicals Group | Dufu Tech vs. Aurelius Technologies Bhd | Dufu Tech vs. Binasat Communications Bhd |
| Aurelius Technologies vs. BP Plastics Holding | Aurelius Technologies vs. Radiant Globaltech Bhd | Aurelius Technologies vs. Magni Tech Industries | Aurelius Technologies vs. Petronas Chemicals Group |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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