Correlation Between SP Merval and Amazon
Can any of the company-specific risk be diversified away by investing in both SP Merval 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 SP Merval and Amazon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SP Merval and Amazon Inc, you can compare the effects of market volatilities on SP Merval 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 SP Merval with a short position of Amazon. Check out your portfolio center. Please also check ongoing floating volatility patterns of SP Merval and Amazon.
Diversification Opportunities for SP Merval and Amazon
Pay attention - limited upside
The 3 months correlation between MERV and Amazon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SP Merval and Amazon Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amazon Inc and SP Merval 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 SP Merval 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 SP Merval i.e., SP Merval and Amazon go up and down completely randomly.
Pair Corralation between SP Merval and Amazon
If you would invest 160,000 in Amazon Inc on September 4, 2024 and sell it today you would earn a total of 1,000.00 from holding Amazon Inc or generate 0.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SP Merval vs. Amazon Inc
Performance |
| Timeline |
SP Merval and Amazon Volatility Contrast
Predicted Return Density |
| Returns |
SP Merval
Pair trading matchups for SP Merval
Amazon Inc
Pair trading matchups for Amazon
Pair Trading with SP Merval and Amazon
The main advantage of trading using opposite SP Merval and Amazon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SP Merval 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.| SP Merval vs. Compania de Transporte | SP Merval vs. Transportadora de Gas | SP Merval vs. Harmony Gold Mining | SP Merval vs. Agrometal SAI |
| Amazon vs. United States Steel | Amazon vs. Compania de Transporte | Amazon vs. Telecom Argentina | Amazon vs. Transportadora de Gas |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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