Correlation Between Amazon and Qurate Retail

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

Diversification Opportunities for Amazon and Qurate Retail

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Amazon and Qurate is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Qurate Retail Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qurate Retail Group 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 Qurate Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qurate Retail Group has no effect on the direction of Amazon i.e., Amazon and Qurate Retail go up and down completely randomly.

Pair Corralation between Amazon and Qurate Retail

If you would invest  15,912  in Amazon Inc on January 26, 2024 and sell it today you would earn a total of  1,747  from holding Amazon Inc or generate 10.98% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Amazon Inc  vs.  Qurate Retail Group

 Performance 
       Timeline  
Amazon Inc 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Amazon Inc are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Amazon may actually be approaching a critical reversion point that can send shares even higher in May 2024.
Qurate Retail Group 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Qurate Retail Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Qurate Retail is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Amazon and Qurate Retail Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amazon and Qurate Retail

The main advantage of trading using opposite Amazon and Qurate Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Qurate Retail 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 Qurate Retail will offset losses from the drop in Qurate Retail's long position.
The idea behind Amazon Inc and Qurate Retail Group 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.

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