Correlation Between Aurora Investment and Take Two
Can any of the company-specific risk be diversified away by investing in both Aurora Investment and Take Two 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 Aurora Investment and Take Two into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurora Investment Trust and Take Two Interactive Software, you can compare the effects of market volatilities on Aurora Investment and Take Two 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 Investment with a short position of Take Two. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Investment and Take Two.
Diversification Opportunities for Aurora Investment and Take Two
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aurora and Take is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Investment Trust and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive and Aurora 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 Aurora Investment Trust are associated (or correlated) with Take Two. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of Aurora Investment i.e., Aurora Investment and Take Two go up and down completely randomly.
Pair Corralation between Aurora Investment and Take Two
Assuming the 90 days trading horizon Aurora Investment Trust is expected to under-perform the Take Two. But the stock apears to be less risky and, when comparing its historical volatility, Aurora Investment Trust is 1.14 times less risky than Take Two. The stock trades about -0.08 of its potential returns per unit of risk. The Take Two Interactive Software is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 18,150 in Take Two Interactive Software on September 14, 2024 and sell it today you would earn a total of 732.00 from holding Take Two Interactive Software or generate 4.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurora Investment Trust vs. Take Two Interactive Software
Performance |
| Timeline |
| Aurora Investment Trust |
| Take Two Interactive |
Aurora Investment and Take Two Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Investment and Take Two
The main advantage of trading using opposite Aurora Investment and Take Two positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Investment position performs unexpectedly, Take Two 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 Take Two will offset losses from the drop in Take Two's long position.| Aurora Investment vs. Catalyst Media Group | Aurora Investment vs. CATLIN GROUP | Aurora Investment vs. Tamburi Investment Partners | Aurora Investment vs. Magnora ASA |
| Take Two vs. Lowland Investment Co | Take Two vs. GoldMining | Take Two vs. Taylor Maritime Investments | Take Two vs. Empire Metals Limited |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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