Correlation Between Amazon and Avantis All
Can any of the company-specific risk be diversified away by investing in both Amazon and Avantis All 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 Avantis All into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon Inc and Avantis All Equity, you can compare the effects of market volatilities on Amazon and Avantis All 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 Avantis All. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and Avantis All.
Diversification Opportunities for Amazon and Avantis All
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Amazon and Avantis is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Avantis All Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avantis All Equity 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 Avantis All. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avantis All Equity has no effect on the direction of Amazon i.e., Amazon and Avantis All go up and down completely randomly.
Pair Corralation between Amazon and Avantis All
Given the investment horizon of 90 days Amazon Inc is expected to under-perform the Avantis All. In addition to that, Amazon is 2.74 times more volatile than Avantis All Equity. It trades about -0.02 of its total potential returns per unit of risk. Avantis All Equity is currently generating about 0.14 per unit of volatility. If you would invest 7,849 in Avantis All Equity on July 17, 2025 and sell it today you would earn a total of 472.00 from holding Avantis All Equity or generate 6.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amazon Inc vs. Avantis All Equity
Performance |
| Timeline |
| Amazon Inc |
| Avantis All Equity |
Amazon and Avantis All Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amazon and Avantis All
The main advantage of trading using opposite Amazon and Avantis All positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Avantis All 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 Avantis All will offset losses from the drop in Avantis All's long position.The idea behind Amazon Inc and Avantis All Equity 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.| Avantis All vs. Avantis Small Cap | Avantis All vs. Avantis International Small | Avantis All vs. Avantis Equity ETF | Avantis All vs. Avantis Emerging Markets |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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