Correlation Between Amazon and USHG Acquisition

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

Diversification Opportunities for Amazon and USHG Acquisition

  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Amazon and USHG Acquisition is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and USHG Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USHG Acquisition Corp 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 USHG Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USHG Acquisition Corp has no effect on the direction of Amazon i.e., Amazon and USHG Acquisition go up and down completely randomly.

Pair Corralation between Amazon and USHG Acquisition

Given the investment horizon of 90 days Amazon Inc is expected to under-perform the USHG Acquisition. In addition to that, Amazon is 22.79 times more volatile than USHG Acquisition Corp. It trades about -0.09 of its total potential returns per unit of risk. USHG Acquisition Corp is currently generating about 0.28 per unit of volatility. If you would invest  993.00  in USHG Acquisition Corp on August 30, 2022 and sell it today you would earn a total of  9.00  from holding USHG Acquisition Corp or generate 0.91% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
ValuesDaily Returns

Amazon Inc  vs.  USHG Acquisition Corp

 Performance (%) 
Amazon Inc 
Amazon Performance
0 of 100
Over the last 90 days Amazon Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in December 2022. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Amazon Price Channel

USHG Acquisition Corp 
USHG Acquisition Performance
14 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in USHG Acquisition Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable technical and fundamental indicators, USHG Acquisition is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

USHG Acquisition Price Channel

Amazon and USHG Acquisition Volatility Contrast

   Predicted Return Density   

Pair Trading with Amazon and USHG Acquisition

The main advantage of trading using opposite Amazon and USHG Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, USHG Acquisition 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 USHG Acquisition will offset losses from the drop in USHG Acquisition's long position.
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The idea behind Amazon Inc and USHG Acquisition Corp 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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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.

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