Correlation Between Aurora Mobile and Shoals Technologies
Can any of the company-specific risk be diversified away by investing in both Aurora Mobile and Shoals Technologies 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 Mobile and Shoals Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurora Mobile and Shoals Technologies Group, you can compare the effects of market volatilities on Aurora Mobile and Shoals Technologies 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 Mobile with a short position of Shoals Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurora Mobile and Shoals Technologies.
Diversification Opportunities for Aurora Mobile and Shoals Technologies
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aurora and Shoals is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Mobile and Shoals Technologies Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shoals Technologies and Aurora Mobile 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 Mobile are associated (or correlated) with Shoals Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shoals Technologies has no effect on the direction of Aurora Mobile i.e., Aurora Mobile and Shoals Technologies go up and down completely randomly.
Pair Corralation between Aurora Mobile and Shoals Technologies
Allowing for the 90-day total investment horizon Aurora Mobile is expected to generate 2.23 times more return on investment than Shoals Technologies. However, Aurora Mobile is 2.23 times more volatile than Shoals Technologies Group. It trades about 0.06 of its potential returns per unit of risk. Shoals Technologies Group is currently generating about -0.01 per unit of risk. If you would invest 726.00 in Aurora Mobile on August 28, 2024 and sell it today you would earn a total of 5.00 from holding Aurora Mobile or generate 0.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurora Mobile vs. Shoals Technologies Group
Performance |
| Timeline |
| Aurora Mobile |
| Shoals Technologies |
Aurora Mobile and Shoals Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurora Mobile and Shoals Technologies
The main advantage of trading using opposite Aurora Mobile and Shoals Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurora Mobile position performs unexpectedly, Shoals Technologies 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 Shoals Technologies will offset losses from the drop in Shoals Technologies' long position.| Aurora Mobile vs. GigaCloud Technology Class | Aurora Mobile vs. Arqit Quantum | Aurora Mobile vs. Telos Corp | Aurora Mobile vs. Cemtrex |
| Shoals Technologies vs. 1847 Holdings LLC | Shoals Technologies vs. Westport Fuel Systems | Shoals Technologies vs. Falcons Beyond Global, | Shoals Technologies vs. Brookfield Business Partners |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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