Correlation Between Amazon and ARTEMIS RESOURCES
Can any of the company-specific risk be diversified away by investing in both Amazon and ARTEMIS RESOURCES 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 Amazon and ARTEMIS RESOURCES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon Inc and ARTEMIS RESOURCES, you can compare the effects of market volatilities on Amazon and ARTEMIS RESOURCES 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 Amazon with a short position of ARTEMIS RESOURCES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and ARTEMIS RESOURCES.
Diversification Opportunities for Amazon and ARTEMIS RESOURCES
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Amazon and ARTEMIS is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and ARTEMIS RESOURCES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ARTEMIS RESOURCES and Amazon 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 Amazon Inc are associated (or correlated) with ARTEMIS RESOURCES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ARTEMIS RESOURCES has no effect on the direction of Amazon i.e., Amazon and ARTEMIS RESOURCES go up and down completely randomly.
Pair Corralation between Amazon and ARTEMIS RESOURCES
Assuming the 90 days trading horizon Amazon Inc is expected to generate 0.32 times more return on investment than ARTEMIS RESOURCES. However, Amazon Inc is 3.12 times less risky than ARTEMIS RESOURCES. It trades about 0.26 of its potential returns per unit of risk. ARTEMIS RESOURCES is currently generating about -0.14 per unit of risk. If you would invest 17,262 in Amazon Inc on October 24, 2024 and sell it today you would earn a total of 4,913 from holding Amazon Inc or generate 28.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amazon Inc vs. ARTEMIS RESOURCES
Performance |
| Timeline |
| Amazon Inc |
| ARTEMIS RESOURCES |
Amazon and ARTEMIS RESOURCES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and ARTEMIS RESOURCES
The main advantage of trading using opposite Amazon and ARTEMIS RESOURCES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, ARTEMIS RESOURCES 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 ARTEMIS RESOURCES will offset losses from the drop in ARTEMIS RESOURCES's long position.| Amazon vs. AEGEAN AIRLINES | Amazon vs. American Airlines Group | Amazon vs. International Consolidated Airlines | Amazon vs. ELECTRONIC ARTS |
| ARTEMIS RESOURCES vs. AIR PRODCHEMICALS | ARTEMIS RESOURCES vs. AWILCO DRILLING PLC | ARTEMIS RESOURCES vs. Pembina Pipeline Corp | ARTEMIS RESOURCES vs. Mitsubishi Gas Chemical |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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