Correlation Between Ingram Micro and Aurora Cannabis

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Can any of the company-specific risk be diversified away by investing in both Ingram Micro and Aurora Cannabis 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 Ingram Micro and Aurora Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingram Micro and Aurora Cannabis, you can compare the effects of market volatilities on Ingram Micro and Aurora Cannabis 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 Ingram Micro with a short position of Aurora Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingram Micro and Aurora Cannabis.

Diversification Opportunities for Ingram Micro and Aurora Cannabis

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Ingram and Aurora is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ingram Micro and Aurora Cannabis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Cannabis and Ingram Micro 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 Ingram Micro are associated (or correlated) with Aurora Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Cannabis has no effect on the direction of Ingram Micro i.e., Ingram Micro and Aurora Cannabis go up and down completely randomly.

Pair Corralation between Ingram Micro and Aurora Cannabis

If you would invest (100.00) in Aurora Cannabis on December 30, 2023 and sell it today you would earn a total of  100.00  from holding Aurora Cannabis or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Ingram Micro  vs.  Aurora Cannabis

 Performance 
       Timeline  
Ingram Micro 

Risk-Adjusted Performance

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Over the last 90 days Ingram Micro has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, Ingram Micro is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.
Aurora Cannabis 

Risk-Adjusted Performance

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Low
 
High
Very Weak
Over the last 90 days Aurora Cannabis has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Aurora Cannabis is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Ingram Micro and Aurora Cannabis Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ingram Micro and Aurora Cannabis

The main advantage of trading using opposite Ingram Micro and Aurora Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingram Micro position performs unexpectedly, Aurora Cannabis 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 Cannabis will offset losses from the drop in Aurora Cannabis' long position.
The idea behind Ingram Micro and Aurora Cannabis 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.
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

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