Correlation Between Aduro Clean and 694308HH3

Can any of the company-specific risk be diversified away by investing in both Aduro Clean and 694308HH3 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 Aduro Clean and 694308HH3 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aduro Clean Technologies and US694308HH37, you can compare the effects of market volatilities on Aduro Clean and 694308HH3 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 Aduro Clean with a short position of 694308HH3. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aduro Clean and 694308HH3.

Diversification Opportunities for Aduro Clean and 694308HH3

-0.41

Correlation Coefficient

Aduro Clean  694308HH3

Very good diversification

The 3 months correlation between Aduro and 694308HH3 is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Aduro Clean Technologies and US694308HH37 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US694308HH37 and Aduro Clean 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 Aduro Clean Technologies are associated (or correlated) with 694308HH3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US694308HH37 has no effect on the direction of Aduro Clean i.e., Aduro Clean and 694308HH3 go up and down completely randomly.

Pair Corralation between Aduro Clean and 694308HH3

Given the investment horizon of 90 days Aduro Clean Technologies is expected to generate 4.15 times more return on investment than 694308HH3. However, Aduro Clean is 4.15 times more volatile than US694308HH37. It trades about 0.09 of its potential returns per unit of risk. US694308HH37 is currently generating about 0.0 per unit of risk. If you would invest  455.00  in Aduro Clean Technologies on October 22, 2024 and sell it today you would earn a total of  81.00  from holding Aduro Clean Technologies or generate 17.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	55.79%
Values	Daily Returns

Aduro Clean Technologies  vs.  US694308HH37

Aduro Clean Technologies

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Aduro Clean Technologies are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Aduro Clean reported solid returns over the last few months and may actually be approaching a breakup point.

US694308HH37

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days US694308HH37 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for US694308HH37 investors.

Pair Trading with Aduro Clean and 694308HH3

The main advantage of trading using opposite Aduro Clean and 694308HH3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aduro Clean position performs unexpectedly, 694308HH3 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 694308HH3 will offset losses from the drop in 694308HH3's long position.

The idea behind Aduro Clean Technologies and US694308HH37 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.