Correlation Between Amazon and 857477BS1
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By analyzing existing cross correlation between Amazon Inc and STT 2203 07 FEB 28, you can compare the effects of market volatilities on Amazon and 857477BS1 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 857477BS1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and 857477BS1.
Diversification Opportunities for Amazon and 857477BS1
Very good diversification
The 3 months correlation between Amazon and 857477BS1 is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and STT 2203 07 FEB 28 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STT 2203 07 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 857477BS1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STT 2203 07 has no effect on the direction of Amazon i.e., Amazon and 857477BS1 go up and down completely randomly.
Pair Corralation between Amazon and 857477BS1
Given the investment horizon of 90 days Amazon Inc is expected to generate 1.8 times more return on investment than 857477BS1. However, Amazon is 1.8 times more volatile than STT 2203 07 FEB 28. It trades about 0.2 of its potential returns per unit of risk. STT 2203 07 FEB 28 is currently generating about -0.23 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 | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Amazon Inc vs. STT 2203 07 FEB 28
Performance |
| Timeline |
| Amazon Inc |
| STT 2203 07 |
Amazon and 857477BS1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and 857477BS1
The main advantage of trading using opposite Amazon and 857477BS1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, 857477BS1 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 857477BS1 will offset losses from the drop in 857477BS1's long position.The idea behind Amazon Inc and STT 2203 07 FEB 28 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.| 857477BS1 vs. AEP TEX INC | 857477BS1 vs. US BANK NATIONAL | 857477BS1 vs. MetLife | 857477BS1 vs. Brera Holdings PLC |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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