Correlation Between Amazon and HAVILA SHIPPING
Can any of the company-specific risk be diversified away by investing in both Amazon and HAVILA SHIPPING 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 HAVILA SHIPPING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon Inc and HAVILA SHIPPING, you can compare the effects of market volatilities on Amazon and HAVILA SHIPPING 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 HAVILA SHIPPING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and HAVILA SHIPPING.
Diversification Opportunities for Amazon and HAVILA SHIPPING
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Amazon and HAVILA is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and HAVILA SHIPPING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAVILA SHIPPING 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 HAVILA SHIPPING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAVILA SHIPPING has no effect on the direction of Amazon i.e., Amazon and HAVILA SHIPPING go up and down completely randomly.
Pair Corralation between Amazon and HAVILA SHIPPING
Assuming the 90 days trading horizon Amazon Inc is expected to generate 0.51 times more return on investment than HAVILA SHIPPING. However, Amazon Inc is 1.94 times less risky than HAVILA SHIPPING. It trades about 0.22 of its potential returns per unit of risk. HAVILA SHIPPING is currently generating about -0.17 per unit of risk. If you would invest 17,536 in Amazon Inc on August 30, 2024 and sell it today you would earn a total of 1,890 from holding Amazon Inc or generate 10.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amazon Inc vs. HAVILA SHIPPING
Performance |
| Timeline |
| Amazon Inc |
| HAVILA SHIPPING |
Amazon and HAVILA SHIPPING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and HAVILA SHIPPING
The main advantage of trading using opposite Amazon and HAVILA SHIPPING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, HAVILA SHIPPING 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 HAVILA SHIPPING will offset losses from the drop in HAVILA SHIPPING's long position.| Amazon vs. Apple Inc | Amazon vs. Apple Inc | Amazon vs. Superior Plus Corp | Amazon vs. SIVERS SEMICONDUCTORS AB |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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