Correlation Between 10X Capital and Aurora Innovation
Can any of the company-specific risk be diversified away by investing in both 10X Capital and Aurora Innovation 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 10X Capital and Aurora Innovation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 10X Capital Venture and Aurora Innovation, you can compare the effects of market volatilities on 10X Capital and Aurora Innovation 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 10X Capital with a short position of Aurora Innovation. Check out your portfolio center. Please also check ongoing floating volatility patterns of 10X Capital and Aurora Innovation.
Diversification Opportunities for 10X Capital and Aurora Innovation
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 10X and Aurora is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding 10X Capital Venture and Aurora Innovation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Innovation and 10X Capital 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 10X Capital Venture are associated (or correlated) with Aurora Innovation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Innovation has no effect on the direction of 10X Capital i.e., 10X Capital and Aurora Innovation go up and down completely randomly.
Pair Corralation between 10X Capital and Aurora Innovation
If you would invest 685.00 in Aurora Innovation on August 27, 2024 and sell it today you would lose (40.00) from holding Aurora Innovation or give up 5.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
10X Capital Venture vs. Aurora Innovation
Performance |
| Timeline |
| 10X Capital Venture |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Aurora Innovation |
10X Capital and Aurora Innovation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 10X Capital and Aurora Innovation
The main advantage of trading using opposite 10X Capital and Aurora Innovation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 10X Capital position performs unexpectedly, Aurora Innovation 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 Innovation will offset losses from the drop in Aurora Innovation's long position.The idea behind 10X Capital Venture and Aurora Innovation pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Aurora Innovation vs. FiscalNote Holdings | Aurora Innovation vs. Innodata | Aurora Innovation vs. International Business Machines | Aurora Innovation vs. BigBearai Holdings |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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