Correlation Between ChampionX and Auri
Can any of the company-specific risk be diversified away by investing in both ChampionX and Auri 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 ChampionX and Auri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChampionX and Auri Inc, you can compare the effects of market volatilities on ChampionX and Auri 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 ChampionX with a short position of Auri. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChampionX and Auri.
Diversification Opportunities for ChampionX and Auri
Average diversification
The 3 months correlation between ChampionX and Auri is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding ChampionX and Auri Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auri Inc and ChampionX 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 ChampionX are associated (or correlated) with Auri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auri Inc has no effect on the direction of ChampionX i.e., ChampionX and Auri go up and down completely randomly.
Pair Corralation between ChampionX and Auri
Considering the 90-day investment horizon ChampionX is expected to generate 111.02 times less return on investment than Auri. But when comparing it to its historical volatility, ChampionX is 17.85 times less risky than Auri. It trades about 0.02 of its potential returns per unit of risk. Auri Inc is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 0.03 in Auri Inc on September 3, 2024 and sell it today you would lose (0.01) from holding Auri Inc or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
ChampionX vs. Auri Inc
Performance |
| Timeline |
| ChampionX |
| Auri Inc |
ChampionX and Auri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChampionX and Auri
The main advantage of trading using opposite ChampionX and Auri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChampionX position performs unexpectedly, Auri 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 Auri will offset losses from the drop in Auri's long position.| ChampionX vs. Expro Group Holdings | ChampionX vs. Ranger Energy Services | ChampionX vs. Cactus Inc | ChampionX vs. MRC Global |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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