Correlation Between Aurora Spine and Cellink AB
Can any of the company-specific risk be diversified away by investing in both Aurora Spine and Cellink AB 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 Spine and Cellink AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurora Spine and Cellink AB, you can compare the effects of market volatilities on Aurora Spine and Cellink AB 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 Spine with a short position of Cellink AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Spine and Cellink AB.
Diversification Opportunities for Aurora Spine and Cellink AB
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Aurora and Cellink is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Spine and Cellink AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellink AB and Aurora Spine 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 Spine are associated (or correlated) with Cellink AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellink AB has no effect on the direction of Aurora Spine i.e., Aurora Spine and Cellink AB go up and down completely randomly.
Pair Corralation between Aurora Spine and Cellink AB
Assuming the 90 days horizon Aurora Spine is expected to generate 2.94 times more return on investment than Cellink AB. However, Aurora Spine is 2.94 times more volatile than Cellink AB. It trades about 0.11 of its potential returns per unit of risk. Cellink AB is currently generating about 0.03 per unit of risk. If you would invest 29.00 in Aurora Spine on October 23, 2024 and sell it today you would earn a total of 2.00 from holding Aurora Spine or generate 6.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Aurora Spine vs. Cellink AB
Performance |
| Timeline |
| Aurora Spine |
| Cellink AB |
Aurora Spine and Cellink AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Spine and Cellink AB
The main advantage of trading using opposite Aurora Spine and Cellink AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Spine position performs unexpectedly, Cellink AB 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 Cellink AB will offset losses from the drop in Cellink AB's long position.| Aurora Spine vs. Ainos Inc | Aurora Spine vs. Armm Inc | Aurora Spine vs. Cellink AB | Aurora Spine vs. Bone Biologics Corp |
| Cellink AB vs. Aurora Spine | Cellink AB vs. Ainos Inc | Cellink AB vs. Armm Inc | Cellink AB vs. Bone Biologics Corp |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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