Correlation Between Newage and Aura Investments
Can any of the company-specific risk be diversified away by investing in both Newage and Aura Investments 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 Newage and Aura Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newage Inc and Aura Investments, you can compare the effects of market volatilities on Newage and Aura Investments 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 Newage with a short position of Aura Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newage and Aura Investments.
Diversification Opportunities for Newage and Aura Investments
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Newage and Aura is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Newage Inc and Aura Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aura Investments and Newage 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 Newage Inc are associated (or correlated) with Aura Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aura Investments has no effect on the direction of Newage i.e., Newage and Aura Investments go up and down completely randomly.
Pair Corralation between Newage and Aura Investments
If you would invest 102,092 in Aura Investments on January 20, 2024 and sell it today you would earn a total of 42,108 from holding Aura Investments or generate 41.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 1.47% |
Values | Daily Returns |
Newage Inc vs. Aura Investments
Performance |
Timeline |
Newage Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Aura Investments |
Newage and Aura Investments Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Newage and Aura Investments
The main advantage of trading using opposite Newage and Aura Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newage position performs unexpectedly, Aura Investments 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 Aura Investments will offset losses from the drop in Aura Investments' long position.Newage vs. Office Properties Income | Newage vs. Sonos Inc | Newage vs. BRP Inc | Newage vs. ANTA Sports Products |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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