Correlation Between AdTheorent Holding and Aurora Innovation
Can any of the company-specific risk be diversified away by investing in both AdTheorent Holding and Aurora Innovation 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 AdTheorent Holding and Aurora Innovation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AdTheorent Holding and Aurora Innovation, you can compare the effects of market volatilities on AdTheorent Holding and Aurora Innovation 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 AdTheorent Holding with a short position of Aurora Innovation. Check out your portfolio center. Please also check ongoing floating volatility patterns of AdTheorent Holding and Aurora Innovation.
Diversification Opportunities for AdTheorent Holding and Aurora Innovation
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between AdTheorent and Aurora is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding AdTheorent Holding and Aurora Innovation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Innovation and AdTheorent Holding 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 AdTheorent Holding are associated (or correlated) with Aurora Innovation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Innovation has no effect on the direction of AdTheorent Holding i.e., AdTheorent Holding and Aurora Innovation go up and down completely randomly.
Pair Corralation between AdTheorent Holding and Aurora Innovation
If you would invest 34.00 in Aurora Innovation on August 28, 2024 and sell it today you would earn a total of 60.00 from holding Aurora Innovation or generate 176.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 1.56% |
| Values | Daily Returns |
AdTheorent Holding vs. Aurora Innovation
Performance |
| Timeline |
| AdTheorent Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Aurora Innovation |
AdTheorent Holding and Aurora Innovation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AdTheorent Holding and Aurora Innovation
The main advantage of trading using opposite AdTheorent Holding and Aurora Innovation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AdTheorent Holding position performs unexpectedly, Aurora Innovation 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 Innovation will offset losses from the drop in Aurora Innovation's long position.| AdTheorent Holding vs. Vita Coco | AdTheorent Holding vs. Japan Tobacco ADR | AdTheorent Holding vs. Emerson Electric | AdTheorent Holding vs. RBC Bearings Incorporated |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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