Correlation Between Chevron Corp and AMAZON
Specify exactly 2 symbols:
By analyzing existing cross correlation between Chevron Corp and AMAZON INC 425, you can compare the effects of market volatilities on Chevron Corp 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 Chevron Corp with a short position of AMAZON. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chevron Corp and AMAZON.
Diversification Opportunities for Chevron Corp and AMAZON
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Chevron and AMAZON is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Chevron Corp and AMAZON INC 425 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMAZON INC 425 and Chevron Corp 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 Chevron Corp 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 425 has no effect on the direction of Chevron Corp i.e., Chevron Corp and AMAZON go up and down completely randomly.
Pair Corralation between Chevron Corp and AMAZON
Considering the 90-day investment horizon Chevron Corp is expected to generate 1.35 times less return on investment than AMAZON. But when comparing it to its historical volatility, Chevron Corp is 1.72 times less risky than AMAZON. It trades about 0.29 of its potential returns per unit of risk. AMAZON INC 425 is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 8,513 in AMAZON INC 425 on August 27, 2024 and sell it today you would earn a total of 861.00 from holding AMAZON INC 425 or generate 10.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chevron Corp vs. AMAZON INC 425
Performance |
| Timeline |
| Chevron Corp |
| AMAZON INC 425 |
Chevron Corp and AMAZON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chevron Corp and AMAZON
The main advantage of trading using opposite Chevron Corp and AMAZON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chevron Corp 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.The idea behind Chevron Corp and AMAZON INC 425 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.| AMAZON vs. Zoom Video Communications | AMAZON vs. Universal Music Group | AMAZON vs. Warner Music Group | AMAZON vs. World Houseware 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |