Correlation Between CSG Systems and Aurora Mobile
Can any of the company-specific risk be diversified away by investing in both CSG Systems and Aurora Mobile 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 CSG Systems and Aurora Mobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSG Systems International and Aurora Mobile, you can compare the effects of market volatilities on CSG Systems and Aurora Mobile 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 CSG Systems with a short position of Aurora Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSG Systems and Aurora Mobile.
Diversification Opportunities for CSG Systems and Aurora Mobile
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CSG and Aurora is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding CSG Systems International and Aurora Mobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Mobile and CSG Systems 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 CSG Systems International are associated (or correlated) with Aurora Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Mobile has no effect on the direction of CSG Systems i.e., CSG Systems and Aurora Mobile go up and down completely randomly.
Pair Corralation between CSG Systems and Aurora Mobile
Given the investment horizon of 90 days CSG Systems International is expected to generate 0.2 times more return on investment than Aurora Mobile. However, CSG Systems International is 5.11 times less risky than Aurora Mobile. It trades about -0.24 of its potential returns per unit of risk. Aurora Mobile is currently generating about -0.18 per unit of risk. If you would invest 5,489 in CSG Systems International on September 22, 2024 and sell it today you would lose (367.00) from holding CSG Systems International or give up 6.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSG Systems International vs. Aurora Mobile
Performance |
| Timeline |
| CSG Systems International |
| Aurora Mobile |
CSG Systems and Aurora Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSG Systems and Aurora Mobile
The main advantage of trading using opposite CSG Systems and Aurora Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSG Systems position performs unexpectedly, Aurora Mobile 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 Aurora Mobile will offset losses from the drop in Aurora Mobile's long position.| CSG Systems vs. Oneconnect Financial Technology | CSG Systems vs. Global Business Travel | CSG Systems vs. Alight Inc | CSG Systems vs. CS Disco LLC |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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