Correlation Between Amazon and Equinix

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Amazon and Equinix 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 Equinix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amazon Inc and Equinix, you can compare the effects of market volatilities on Amazon and Equinix 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 Equinix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amazon and Equinix.

Diversification Opportunities for Amazon and Equinix

-0.09
  Correlation Coefficient

Good diversification

The 3 months correlation between Amazon and Equinix is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Amazon Inc and Equinix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equinix 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 Equinix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equinix has no effect on the direction of Amazon i.e., Amazon and Equinix go up and down completely randomly.

Pair Corralation between Amazon and Equinix

Given the investment horizon of 90 days Amazon Inc is expected to under-perform the Equinix. In addition to that, Amazon is 1.3 times more volatile than Equinix. It trades about -0.11 of its total potential returns per unit of risk. Equinix is currently generating about 0.18 per unit of volatility. If you would invest  57,609  in Equinix on September 2, 2022 and sell it today you would earn a total of  12,206  from holding Equinix or generate 21.19% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Amazon Inc  vs.  Equinix

 Performance (%) 
       Timeline  
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 inconsistent performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2023. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Amazon Price Channel

Equinix 
Equinix Performance
6 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Equinix are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating forward indicators, Equinix may actually be approaching a critical reversion point that can send shares even higher in January 2023.

Equinix Price Channel

Amazon and Equinix Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amazon and Equinix

The main advantage of trading using opposite Amazon and Equinix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amazon position performs unexpectedly, Equinix 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 Equinix will offset losses from the drop in Equinix's long position.
Amazon vs. Merck Company
Amazon vs. Walmart
Amazon vs. Chevron Corp
Amazon vs. Verizon Communications
The idea behind Amazon Inc and Equinix 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.
Equinix vs. PepsiCo
Equinix vs. Amark Preci
Equinix vs. Chevron Corp
Equinix vs. CBIZ Inc
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.

Other Complementary Tools

Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Focused Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Go
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Go