Correlation Between Cincinnati Financial and AMAZONCOM
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By analyzing existing cross correlation between Cincinnati Financial and AMAZONCOM INC, you can compare the effects of market volatilities on Cincinnati Financial and AMAZONCOM 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 Cincinnati Financial with a short position of AMAZONCOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cincinnati Financial and AMAZONCOM.
Diversification Opportunities for Cincinnati Financial and AMAZONCOM
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cincinnati and AMAZONCOM is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Cincinnati Financial and AMAZONCOM INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMAZONCOM INC and Cincinnati Financial 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 Cincinnati Financial are associated (or correlated) with AMAZONCOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMAZONCOM INC has no effect on the direction of Cincinnati Financial i.e., Cincinnati Financial and AMAZONCOM go up and down completely randomly.
Pair Corralation between Cincinnati Financial and AMAZONCOM
Given the investment horizon of 90 days Cincinnati Financial is expected to generate 1.81 times more return on investment than AMAZONCOM. However, Cincinnati Financial is 1.81 times more volatile than AMAZONCOM INC. It trades about 0.15 of its potential returns per unit of risk. AMAZONCOM INC is currently generating about 0.0 per unit of risk. If you would invest 9,986 in Cincinnati Financial on September 2, 2024 and sell it today you would earn a total of 5,997 from holding Cincinnati Financial or generate 60.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Cincinnati Financial vs. AMAZONCOM INC
Performance |
| Timeline |
| Cincinnati Financial |
| AMAZONCOM INC |
Cincinnati Financial and AMAZONCOM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cincinnati Financial and AMAZONCOM
The main advantage of trading using opposite Cincinnati Financial and AMAZONCOM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cincinnati Financial position performs unexpectedly, AMAZONCOM 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 AMAZONCOM will offset losses from the drop in AMAZONCOM's long position.| Cincinnati Financial vs. Progressive Corp | Cincinnati Financial vs. The Travelers Companies | Cincinnati Financial vs. Chubb | Cincinnati Financial vs. W R Berkley |
| AMAZONCOM vs. AEP TEX INC | AMAZONCOM vs. US BANK NATIONAL | AMAZONCOM vs. Bank of America | AMAZONCOM vs. GE Aerospace |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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