Correlation Between Amazon CDR and Kiplin Metals
Can any of the company-specific risk be diversified away by investing in both Amazon CDR and Kiplin Metals 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 CDR and Kiplin Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon CDR and Kiplin Metals, you can compare the effects of market volatilities on Amazon CDR and Kiplin Metals 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 CDR with a short position of Kiplin Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon CDR and Kiplin Metals.
Diversification Opportunities for Amazon CDR and Kiplin Metals
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Amazon and Kiplin is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Amazon CDR and Kiplin Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiplin Metals and Amazon CDR 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 CDR are associated (or correlated) with Kiplin Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiplin Metals has no effect on the direction of Amazon CDR i.e., Amazon CDR and Kiplin Metals go up and down completely randomly.
Pair Corralation between Amazon CDR and Kiplin Metals
Assuming the 90 days trading horizon Amazon CDR is expected to generate 0.23 times more return on investment than Kiplin Metals. However, Amazon CDR is 4.42 times less risky than Kiplin Metals. It trades about 0.1 of its potential returns per unit of risk. Kiplin Metals is currently generating about 0.0 per unit of risk. If you would invest 1,886 in Amazon CDR on November 9, 2024 and sell it today you would earn a total of 949.00 from holding Amazon CDR or generate 50.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.54% |
| Values | Daily Returns |
Amazon CDR vs. Kiplin Metals
Performance |
| Timeline |
| Amazon CDR |
| Kiplin Metals |
Amazon CDR and Kiplin Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon CDR and Kiplin Metals
The main advantage of trading using opposite Amazon CDR and Kiplin Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon CDR position performs unexpectedly, Kiplin Metals 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 Kiplin Metals will offset losses from the drop in Kiplin Metals' long position.| Amazon CDR vs. T2 Metals Corp | Amazon CDR vs. Network Media Group | Amazon CDR vs. Mako Mining Corp | Amazon CDR vs. Dream Industrial Real |
| Kiplin Metals vs. Arbor Metals Corp | Kiplin Metals vs. Marvel Discovery Corp | Kiplin Metals vs. Fission 30 Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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