Correlation Between Aurora Mobile and Usio

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

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

Diversification Opportunities for Aurora Mobile and Usio

-0.22

Correlation Coefficient

Aurora Mobile  Usio

Very good diversification

The 3 months correlation between Aurora and Usio is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Aurora Mobile and Usio Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Usio Inc and Aurora Mobile 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 Aurora Mobile are associated (or correlated) with Usio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Usio Inc has no effect on the direction of Aurora Mobile i.e., Aurora Mobile and Usio go up and down completely randomly.

Pair Corralation between Aurora Mobile and Usio

Allowing for the 90-day total investment horizon Aurora Mobile is expected to generate 2.9 times more return on investment than Usio. However, Aurora Mobile is 2.9 times more volatile than Usio Inc. It trades about 0.1 of its potential returns per unit of risk. Usio Inc is currently generating about 0.06 per unit of risk. If you would invest  668.00  in Aurora Mobile on December 27, 2024 and sell it today you would earn a total of  378.00  from holding Aurora Mobile or generate 56.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Aurora Mobile  vs.  Usio Inc

Aurora Mobile

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aurora Mobile are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain technical and fundamental indicators, Aurora Mobile reported solid returns over the last few months and may actually be approaching a breakup point.

Usio Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Usio Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward indicators, Usio displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aurora Mobile and Usio

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

The idea behind Aurora Mobile and Usio Inc 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.

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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.