Correlation Between Auddia and Life360
Can any of the company-specific risk be diversified away by investing in both Auddia and Life360 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 Auddia and Life360 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auddia Inc and Life360, you can compare the effects of market volatilities on Auddia and Life360 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 Auddia with a short position of Life360. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auddia and Life360.
Diversification Opportunities for Auddia and Life360
Good diversification
The 3 months correlation between Auddia and Life360 is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Auddia Inc and Life360 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life360 and Auddia 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 Auddia Inc are associated (or correlated) with Life360. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life360 has no effect on the direction of Auddia i.e., Auddia and Life360 go up and down completely randomly.
Pair Corralation between Auddia and Life360
Assuming the 90 days horizon Auddia Inc is expected to generate 3.82 times more return on investment than Life360. However, Auddia is 3.82 times more volatile than Life360. It trades about 0.15 of its potential returns per unit of risk. Life360 is currently generating about 0.17 per unit of risk. If you would invest 2.11 in Auddia Inc on November 2, 2024 and sell it today you would earn a total of 0.49 from holding Auddia Inc or generate 23.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Auddia Inc vs. Life360
Performance |
| Timeline |
| Auddia Inc |
| Life360 |
Auddia and Life360 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auddia and Life360
The main advantage of trading using opposite Auddia and Life360 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auddia position performs unexpectedly, Life360 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 Life360 will offset losses from the drop in Life360's long position.| Auddia vs. Genuine Parts Co | Auddia vs. Village Super Market | Auddia vs. Cardinal Health | Auddia vs. Enersys |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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