Correlation Between FactSet Research and Aurora Technology

Can any of the company-specific risk be diversified away by investing in both FactSet Research 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 FactSet Research and Aurora Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FactSet Research Systems and Aurora Technology Acquisition, you can compare the effects of market volatilities on FactSet Research 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 FactSet Research with a short position of Aurora Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of FactSet Research and Aurora Technology.

Diversification Opportunities for FactSet Research and Aurora Technology

0.0

Correlation Coefficient

FactSet Research  Aurora Technology

Pay attention - limited upside

The 3 months correlation between FactSet and Aurora is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FactSet Research Systems and Aurora Technology Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Technology and FactSet Research 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 FactSet Research Systems 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 FactSet Research i.e., FactSet Research and Aurora Technology go up and down completely randomly.

Pair Corralation between FactSet Research and Aurora Technology

If you would invest (100.00) in Aurora Technology Acquisition on December 4, 2024 and sell it today you would earn a total of  100.00  from holding Aurora Technology Acquisition or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

FactSet Research Systems  vs.  Aurora Technology Acquisition

FactSet Research Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days FactSet Research Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, FactSet Research is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Aurora Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aurora Technology Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking signals, Aurora Technology is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with FactSet Research and Aurora Technology

The main advantage of trading using opposite FactSet Research and Aurora Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FactSet Research 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.

The idea behind FactSet Research Systems and Aurora Technology Acquisition 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.