Correlation Between Tidal Trust and YieldMax AMZN
Can any of the company-specific risk be diversified away by investing in both Tidal Trust and YieldMax AMZN 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 Tidal Trust and YieldMax AMZN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tidal Trust II and YieldMax AMZN Option, you can compare the effects of market volatilities on Tidal Trust and YieldMax AMZN 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 Tidal Trust with a short position of YieldMax AMZN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal Trust and YieldMax AMZN.
Diversification Opportunities for Tidal Trust and YieldMax AMZN
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tidal and YieldMax is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Tidal Trust II and YieldMax AMZN Option in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YieldMax AMZN Option and Tidal Trust 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 Tidal Trust II are associated (or correlated) with YieldMax AMZN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YieldMax AMZN Option has no effect on the direction of Tidal Trust i.e., Tidal Trust and YieldMax AMZN go up and down completely randomly.
Pair Corralation between Tidal Trust and YieldMax AMZN
Given the investment horizon of 90 days Tidal Trust II is expected to under-perform the YieldMax AMZN. But the etf apears to be less risky and, when comparing its historical volatility, Tidal Trust II is 1.49 times less risky than YieldMax AMZN. The etf trades about -0.03 of its potential returns per unit of risk. The YieldMax AMZN Option is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,118 in YieldMax AMZN Option on November 19, 2024 and sell it today you would earn a total of 769.00 from holding YieldMax AMZN Option or generate 68.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 89.75% |
| Values | Daily Returns |
Tidal Trust II vs. YieldMax AMZN Option
Performance |
| Timeline |
| Tidal Trust II |
| YieldMax AMZN Option |
Tidal Trust and YieldMax AMZN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tidal Trust and YieldMax AMZN
The main advantage of trading using opposite Tidal Trust and YieldMax AMZN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidal Trust position performs unexpectedly, YieldMax AMZN 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 YieldMax AMZN will offset losses from the drop in YieldMax AMZN's long position.The idea behind Tidal Trust II and YieldMax AMZN Option 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.| YieldMax AMZN vs. Tidal Trust II | YieldMax AMZN vs. Tidal Trust II | YieldMax AMZN vs. Direxion Daily META | YieldMax AMZN vs. Direxion Daily META |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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