Correlation Between EVRAZ Plc and Amazon

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Can any of the company-specific risk be diversified away by investing in both EVRAZ Plc 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 EVRAZ Plc and Amazon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EVRAZ Plc and Amazon Inc, you can compare the effects of market volatilities on EVRAZ Plc 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 EVRAZ Plc with a short position of Amazon. Check out your portfolio center. Please also check ongoing floating volatility patterns of EVRAZ Plc and Amazon.

Diversification Opportunities for EVRAZ Plc and Amazon

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between EVRAZ and Amazon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EVRAZ Plc and Amazon Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amazon Inc and EVRAZ Plc 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 EVRAZ Plc 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 EVRAZ Plc i.e., EVRAZ Plc and Amazon go up and down completely randomly.

Pair Corralation between EVRAZ Plc and Amazon

If you would invest  10,395  in Amazon Inc on December 30, 2023 and sell it today you would earn a total of  7,643  from holding Amazon Inc or generate 73.53% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.4%
ValuesDaily Returns

EVRAZ Plc  vs.  Amazon Inc

 Performance 
       Timeline  
EVRAZ Plc 

Risk-Adjusted Performance

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Over the last 90 days EVRAZ Plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, EVRAZ Plc is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
Amazon Inc 

Risk-Adjusted Performance

14 of 100

 
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Good
Compared to the overall equity markets, risk-adjusted returns on investments in Amazon Inc are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent basic indicators, Amazon displayed solid returns over the last few months and may actually be approaching a breakup point.

EVRAZ Plc and Amazon Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with EVRAZ Plc and Amazon

The main advantage of trading using opposite EVRAZ Plc and Amazon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EVRAZ Plc 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 EVRAZ Plc and Amazon Inc 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.
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.

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