Correlation Between Aurora Technology and Bank of New York
Can any of the company-specific risk be diversified away by investing in both Aurora Technology and Bank of New York 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 Technology and Bank of New York into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurora Technology Acquisition and Bank of New, you can compare the effects of market volatilities on Aurora Technology and Bank of New York 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 Technology with a short position of Bank of New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Technology and Bank of New York.
Diversification Opportunities for Aurora Technology and Bank of New York
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aurora and Bank is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Technology Acquisition and Bank of New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of New York and Aurora Technology 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 Technology Acquisition are associated (or correlated) with Bank of New York. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of New York has no effect on the direction of Aurora Technology i.e., Aurora Technology and Bank of New York go up and down completely randomly.
Pair Corralation between Aurora Technology and Bank of New York
Assuming the 90 days horizon Aurora Technology is expected to generate 8.24 times less return on investment than Bank of New York. But when comparing it to its historical volatility, Aurora Technology Acquisition is 9.66 times less risky than Bank of New York. It trades about 0.19 of its potential returns per unit of risk. Bank of New is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 4,167 in Bank of New on September 2, 2024 and sell it today you would earn a total of 4,020 from holding Bank of New or generate 96.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 7.8% |
| Values | Daily Returns |
Aurora Technology Acquisition vs. Bank of New
Performance |
| Timeline |
| Aurora Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bank of New York |
Aurora Technology and Bank of New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Technology and Bank of New York
The main advantage of trading using opposite Aurora Technology and Bank of New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Technology position performs unexpectedly, Bank of New York 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 Bank of New York will offset losses from the drop in Bank of New York's long position.| Aurora Technology vs. Chipotle Mexican Grill | Aurora Technology vs. RCI Hospitality Holdings | Aurora Technology vs. Dennys Corp | Aurora Technology vs. Shake Shack |
| Bank of New York vs. Northern Trust | Bank of New York vs. Invesco Plc | Bank of New York vs. Franklin Resources | Bank of New York vs. T Rowe Price |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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