Correlation Between Amazon and Bangkok Commercial
Can any of the company-specific risk be diversified away by investing in both Amazon and Bangkok Commercial 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 Bangkok Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon Inc and Bangkok Commercial Property, you can compare the effects of market volatilities on Amazon and Bangkok Commercial 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 Bangkok Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and Bangkok Commercial.
Diversification Opportunities for Amazon and Bangkok Commercial
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Amazon and Bangkok is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Bangkok Commercial Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Commercial 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 Bangkok Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Commercial has no effect on the direction of Amazon i.e., Amazon and Bangkok Commercial go up and down completely randomly.
Pair Corralation between Amazon and Bangkok Commercial
Given the investment horizon of 90 days Amazon is expected to generate 10.09 times less return on investment than Bangkok Commercial. But when comparing it to its historical volatility, Amazon Inc is 23.55 times less risky than Bangkok Commercial. It trades about 0.09 of its potential returns per unit of risk. Bangkok Commercial Property is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,030 in Bangkok Commercial Property on September 3, 2024 and sell it today you would lose (125.00) from holding Bangkok Commercial Property or give up 12.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.37% |
| Values | Daily Returns |
Amazon Inc vs. Bangkok Commercial Property
Performance |
| Timeline |
| Amazon Inc |
| Bangkok Commercial |
Amazon and Bangkok Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and Bangkok Commercial
The main advantage of trading using opposite Amazon and Bangkok Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Bangkok Commercial 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 Bangkok Commercial will offset losses from the drop in Bangkok Commercial's long position.The idea behind Amazon Inc and Bangkok Commercial Property 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.| Bangkok Commercial vs. WHA Premium Growth | Bangkok Commercial vs. Impact Growth REIT | Bangkok Commercial vs. LH Shopping Centers | Bangkok Commercial vs. Golden Ventures Leasehold |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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