Correlation Between Amazon and TAISEM
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By analyzing existing cross correlation between Amazon Inc and TAISEM 45 22 APR 52, you can compare the effects of market volatilities on Amazon and TAISEM 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 TAISEM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and TAISEM.
Diversification Opportunities for Amazon and TAISEM
Excellent diversification
The 3 months correlation between Amazon and TAISEM is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and TAISEM 45 22 APR 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TAISEM 45 22 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 TAISEM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TAISEM 45 22 has no effect on the direction of Amazon i.e., Amazon and TAISEM go up and down completely randomly.
Pair Corralation between Amazon and TAISEM
Given the investment horizon of 90 days Amazon Inc is expected to generate 1.22 times more return on investment than TAISEM. However, Amazon is 1.22 times more volatile than TAISEM 45 22 APR 52. It trades about 0.08 of its potential returns per unit of risk. TAISEM 45 22 APR 52 is currently generating about 0.01 per unit of risk. If you would invest 12,657 in Amazon Inc on September 4, 2024 and sell it today you would earn a total of 8,414 from holding Amazon Inc or generate 66.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 67.29% |
| Values | Daily Returns |
Amazon Inc vs. TAISEM 45 22 APR 52
Performance |
| Timeline |
| Amazon Inc |
| TAISEM 45 22 |
Amazon and TAISEM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and TAISEM
The main advantage of trading using opposite Amazon and TAISEM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, TAISEM 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 TAISEM will offset losses from the drop in TAISEM's long position.The idea behind Amazon Inc and TAISEM 45 22 APR 52 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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