Correlation Between Amazon CDR and Imperial Oil
Can any of the company-specific risk be diversified away by investing in both Amazon CDR and Imperial Oil 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 CDR and Imperial Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon CDR and Imperial Oil, you can compare the effects of market volatilities on Amazon CDR and Imperial Oil 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 CDR with a short position of Imperial Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon CDR and Imperial Oil.
Diversification Opportunities for Amazon CDR and Imperial Oil
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amazon and Imperial is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Amazon CDR and Imperial Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imperial Oil and Amazon CDR 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 CDR are associated (or correlated) with Imperial Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imperial Oil has no effect on the direction of Amazon CDR i.e., Amazon CDR and Imperial Oil go up and down completely randomly.
Pair Corralation between Amazon CDR and Imperial Oil
Assuming the 90 days trading horizon Amazon CDR is expected to generate 1.23 times more return on investment than Imperial Oil. However, Amazon CDR is 1.23 times more volatile than Imperial Oil. It trades about 0.23 of its potential returns per unit of risk. Imperial Oil is currently generating about 0.25 per unit of risk. If you would invest 2,136 in Amazon CDR on April 23, 2025 and sell it today you would earn a total of 538.00 from holding Amazon CDR or generate 25.19% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Amazon CDR vs. Imperial Oil
Performance |
Timeline |
Amazon CDR |
Imperial Oil |
Amazon CDR and Imperial Oil Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Amazon CDR and Imperial Oil
The main advantage of trading using opposite Amazon CDR and Imperial Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon CDR position performs unexpectedly, Imperial Oil 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 Imperial Oil will offset losses from the drop in Imperial Oil's long position.Amazon CDR vs. Magna Mining | Amazon CDR vs. Westshore Terminals Investment | Amazon CDR vs. Farstarcap Investment Corp | Amazon CDR vs. American Hotel Income |
Imperial Oil vs. Canadian Natural Resources | Imperial Oil vs. Cenovus Energy | Imperial Oil vs. TC Energy Corp | Imperial Oil vs. Suncor Energy |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Transaction History View history of all your transactions and understand their impact on performance | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Commodity Channel Use Commodity Channel Index to analyze current equity momentum |