Correlation Between Xtract One and Amazon CDR
Can any of the company-specific risk be diversified away by investing in both Xtract One and Amazon CDR 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 Xtract One and Amazon CDR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtract One Technologies and Amazon CDR, you can compare the effects of market volatilities on Xtract One and Amazon CDR 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 Xtract One with a short position of Amazon CDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtract One and Amazon CDR.
Diversification Opportunities for Xtract One and Amazon CDR
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xtract and Amazon is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Xtract One Technologies and Amazon CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amazon CDR and Xtract One 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 Xtract One Technologies are associated (or correlated) with Amazon CDR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amazon CDR has no effect on the direction of Xtract One i.e., Xtract One and Amazon CDR go up and down completely randomly.
Pair Corralation between Xtract One and Amazon CDR
Assuming the 90 days trading horizon Xtract One is expected to generate 13.03 times less return on investment than Amazon CDR. In addition to that, Xtract One is 1.01 times more volatile than Amazon CDR. It trades about 0.01 of its total potential returns per unit of risk. Amazon CDR is currently generating about 0.15 per unit of volatility. If you would invest 2,299 in Amazon CDR on August 31, 2024 and sell it today you would earn a total of 171.00 from holding Amazon CDR or generate 7.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtract One Technologies vs. Amazon CDR
Performance |
| Timeline |
| Xtract One Technologies |
| Amazon CDR |
Xtract One and Amazon CDR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtract One and Amazon CDR
The main advantage of trading using opposite Xtract One and Amazon CDR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtract One position performs unexpectedly, Amazon CDR 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 CDR will offset losses from the drop in Amazon CDR's long position.| Xtract One vs. Mene Inc | Xtract One vs. Africa Oil Corp | Xtract One vs. Financial 15 Split | Xtract One vs. Rubicon Organics |
| Amazon CDR vs. Berkshire Hathaway CDR | Amazon CDR vs. JPMorgan Chase Co | Amazon CDR vs. Bank of America | Amazon CDR vs. Alphabet Inc CDR |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |