Correlation Between CANON MARKETING and Amazon
Can any of the company-specific risk be diversified away by investing in both CANON MARKETING and Amazon 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 CANON MARKETING and Amazon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CANON MARKETING JP and Amazon Inc, you can compare the effects of market volatilities on CANON MARKETING and Amazon 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 CANON MARKETING with a short position of Amazon. Check out your portfolio center. Please also check ongoing floating volatility patterns of CANON MARKETING and Amazon.
Diversification Opportunities for CANON MARKETING and Amazon
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CANON and Amazon is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding CANON MARKETING JP and Amazon Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amazon Inc and CANON MARKETING 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 CANON MARKETING JP are associated (or correlated) with Amazon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amazon Inc has no effect on the direction of CANON MARKETING i.e., CANON MARKETING and Amazon go up and down completely randomly.
Pair Corralation between CANON MARKETING and Amazon
Assuming the 90 days trading horizon CANON MARKETING JP is expected to generate 0.48 times more return on investment than Amazon. However, CANON MARKETING JP is 2.08 times less risky than Amazon. It trades about 0.44 of its potential returns per unit of risk. Amazon Inc is currently generating about 0.19 per unit of risk. If you would invest 2,620 in CANON MARKETING JP on August 25, 2024 and sell it today you would earn a total of 300.00 from holding CANON MARKETING JP or generate 11.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
CANON MARKETING JP vs. Amazon Inc
Performance |
| Timeline |
| CANON MARKETING JP |
| Amazon Inc |
CANON MARKETING and Amazon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CANON MARKETING and Amazon
The main advantage of trading using opposite CANON MARKETING and Amazon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CANON MARKETING position performs unexpectedly, Amazon 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 Amazon will offset losses from the drop in Amazon's long position.| CANON MARKETING vs. Elmos Semiconductor SE | CANON MARKETING vs. MOVIE GAMES SA | CANON MARKETING vs. Waste Management | CANON MARKETING vs. TOREX SEMICONDUCTOR LTD |
| Amazon vs. PKSHA TECHNOLOGY INC | Amazon vs. CANON MARKETING JP | Amazon vs. Vastned Retail NV | Amazon vs. Uber Technologies |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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