Correlation Between Weibo Corp and Aurora Technology
Can any of the company-specific risk be diversified away by investing in both Weibo Corp and Aurora Technology 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 Weibo Corp and Aurora Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weibo Corp and Aurora Technology Acquisition, you can compare the effects of market volatilities on Weibo Corp and Aurora Technology 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 Weibo Corp with a short position of Aurora Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weibo Corp and Aurora Technology.
Diversification Opportunities for Weibo Corp and Aurora Technology
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Weibo and Aurora is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Weibo Corp and Aurora Technology Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Technology and Weibo Corp 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 Weibo Corp are associated (or correlated) with Aurora Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Technology has no effect on the direction of Weibo Corp i.e., Weibo Corp and Aurora Technology go up and down completely randomly.
Pair Corralation between Weibo Corp and Aurora Technology
If you would invest 1,225 in Weibo Corp on September 12, 2024 and sell it today you would lose (194.00) from holding Weibo Corp or give up 15.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.85% |
| Values | Daily Returns |
Weibo Corp vs. Aurora Technology Acquisition
Performance |
| Timeline |
| Weibo Corp |
| Aurora Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Weibo Corp and Aurora Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weibo Corp and Aurora Technology
The main advantage of trading using opposite Weibo Corp and Aurora Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weibo Corp position performs unexpectedly, Aurora Technology 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 Technology will offset losses from the drop in Aurora Technology's long position.| Weibo Corp vs. Twilio Inc | Weibo Corp vs. Meta Platforms | Weibo Corp vs. Alphabet Inc Class C | Weibo Corp vs. Alphabet Inc Class A |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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