Correlation Between Amazon and Bitget Token
Can any of the company-specific risk be diversified away by investing in both Amazon and Bitget Token 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 Bitget Token into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon Inc and Bitget token, you can compare the effects of market volatilities on Amazon and Bitget Token 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 Bitget Token. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and Bitget Token.
Diversification Opportunities for Amazon and Bitget Token
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amazon and Bitget is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Bitget token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitget token 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 Bitget Token. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitget token has no effect on the direction of Amazon i.e., Amazon and Bitget Token go up and down completely randomly.
Pair Corralation between Amazon and Bitget Token
Given the investment horizon of 90 days Amazon is expected to generate 3.03 times less return on investment than Bitget Token. But when comparing it to its historical volatility, Amazon Inc is 1.82 times less risky than Bitget Token. It trades about 0.27 of its potential returns per unit of risk. Bitget token is currently generating about 0.45 of returns per unit of risk over similar time horizon. If you would invest 116.00 in Bitget token on September 5, 2024 and sell it today you would earn a total of 47.00 from holding Bitget token or generate 40.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Amazon Inc vs. Bitget token
Performance |
| Timeline |
| Amazon Inc |
| Bitget token |
Amazon and Bitget Token Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and Bitget Token
The main advantage of trading using opposite Amazon and Bitget Token positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Bitget Token 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 Bitget Token will offset losses from the drop in Bitget Token's long position.The idea behind Amazon Inc and Bitget token 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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