Correlation Between Amazon and Rogers Communications

Can any of the company-specific risk be diversified away by investing in both Amazon and Rogers Communications 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 Amazon and Rogers Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amazon Inc and Rogers Communications, you can compare the effects of market volatilities on Amazon and Rogers Communications 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 Amazon with a short position of Rogers Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and Rogers Communications.

Diversification Opportunities for Amazon and Rogers Communications

0.63

Correlation Coefficient

Amazon  Rogers Communications

Poor diversification

The 3 months correlation between Amazon and Rogers is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Rogers Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rogers Communications and Amazon 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 Amazon Inc are associated (or correlated) with Rogers Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rogers Communications has no effect on the direction of Amazon i.e., Amazon and Rogers Communications go up and down completely randomly.

Pair Corralation between Amazon and Rogers Communications

Assuming the 90 days trading horizon Amazon is expected to generate 1.07 times less return on investment than Rogers Communications. In addition to that, Amazon is 1.34 times more volatile than Rogers Communications. It trades about 0.21 of its total potential returns per unit of risk. Rogers Communications is currently generating about 0.3 per unit of volatility. If you would invest  2,170  in Rogers Communications on April 22, 2025 and sell it today you would earn a total of  670.00  from holding Rogers Communications or generate 30.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Amazon Inc  vs.  Rogers Communications

Amazon Inc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amazon Inc are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Amazon unveiled solid returns over the last few months and may actually be approaching a breakup point.

Rogers Communications

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Rogers Communications are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, Rogers Communications reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amazon and Rogers Communications

The main advantage of trading using opposite Amazon and Rogers Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Rogers Communications 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 Rogers Communications will offset losses from the drop in Rogers Communications' long position.

The idea behind Amazon Inc and Rogers Communications 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.