Correlation Between Aurora Investment and Tyson Foods
Can any of the company-specific risk be diversified away by investing in both Aurora Investment and Tyson Foods 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 Tyson Foods 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 Tyson Foods Cl, you can compare the effects of market volatilities on Aurora Investment and Tyson Foods 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 Tyson Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Investment and Tyson Foods.
Diversification Opportunities for Aurora Investment and Tyson Foods
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aurora and Tyson is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Investment Trust and Tyson Foods Cl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tyson Foods Cl 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 Tyson Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tyson Foods Cl has no effect on the direction of Aurora Investment i.e., Aurora Investment and Tyson Foods go up and down completely randomly.
Pair Corralation between Aurora Investment and Tyson Foods
Assuming the 90 days trading horizon Aurora Investment is expected to generate 2.2 times less return on investment than Tyson Foods. But when comparing it to its historical volatility, Aurora Investment Trust is 1.39 times less risky than Tyson Foods. It trades about 0.04 of its potential returns per unit of risk. Tyson Foods Cl is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 4,793 in Tyson Foods Cl on September 2, 2024 and sell it today you would earn a total of 1,657 from holding Tyson Foods Cl or generate 34.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.94% |
| Values | Daily Returns |
Aurora Investment Trust vs. Tyson Foods Cl
Performance |
| Timeline |
| Aurora Investment Trust |
| Tyson Foods Cl |
Aurora Investment and Tyson Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Investment and Tyson Foods
The main advantage of trading using opposite Aurora Investment and Tyson Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Investment position performs unexpectedly, Tyson Foods 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 Tyson Foods will offset losses from the drop in Tyson Foods' long position.| Aurora Investment vs. Toyota Motor Corp | Aurora Investment vs. SoftBank Group Corp | Aurora Investment vs. OTP Bank Nyrt | Aurora Investment vs. Las Vegas Sands |
| Tyson Foods vs. Hochschild Mining plc | Tyson Foods vs. Sydbank | Tyson Foods vs. MTI Wireless Edge | Tyson Foods vs. Ameriprise Financial |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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