Correlation Between Amazon and Mold Tek
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By analyzing existing cross correlation between Amazon Inc and Mold Tek Packaging Limited, you can compare the effects of market volatilities on Amazon and Mold Tek 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 Mold Tek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and Mold Tek.
Diversification Opportunities for Amazon and Mold Tek
Excellent diversification
The 3 months correlation between Amazon and Mold is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Mold Tek Packaging Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mold Tek Packaging 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 Mold Tek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mold Tek Packaging has no effect on the direction of Amazon i.e., Amazon and Mold Tek go up and down completely randomly.
Pair Corralation between Amazon and Mold Tek
Given the investment horizon of 90 days Amazon Inc is expected to generate 1.23 times more return on investment than Mold Tek. However, Amazon is 1.23 times more volatile than Mold Tek Packaging Limited. It trades about 0.19 of its potential returns per unit of risk. Mold Tek Packaging Limited is currently generating about -0.24 per unit of risk. If you would invest 19,578 in Amazon Inc on September 4, 2024 and sell it today you would earn a total of 1,493 from holding Amazon Inc or generate 7.63% 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. Mold Tek Packaging Limited
Performance |
| Timeline |
| Amazon Inc |
| Mold Tek Packaging |
Amazon and Mold Tek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and Mold Tek
The main advantage of trading using opposite Amazon and Mold Tek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Mold Tek 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 Mold Tek will offset losses from the drop in Mold Tek's long position.The idea behind Amazon Inc and Mold Tek Packaging Limited 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.| Mold Tek vs. ideaForge Technology Limited | Mold Tek vs. Nucleus Software Exports | Mold Tek vs. Transport of | Mold Tek vs. Sarthak Metals Limited |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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