Correlation Between Aquagold International and Amplify ETF
Can any of the company-specific risk be diversified away by investing in both Aquagold International and Amplify ETF 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 Aquagold International and Amplify ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquagold International and Amplify ETF Trust, you can compare the effects of market volatilities on Aquagold International and Amplify ETF 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 Aquagold International with a short position of Amplify ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquagold International and Amplify ETF.
Diversification Opportunities for Aquagold International and Amplify ETF
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aquagold and Amplify is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Amplify ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify ETF Trust and Aquagold International 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 Aquagold International are associated (or correlated) with Amplify ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify ETF Trust has no effect on the direction of Aquagold International i.e., Aquagold International and Amplify ETF go up and down completely randomly.
Pair Corralation between Aquagold International and Amplify ETF
Given the investment horizon of 90 days Aquagold International is expected to generate 12.76 times more return on investment than Amplify ETF. However, Aquagold International is 12.76 times more volatile than Amplify ETF Trust. It trades about 0.05 of its potential returns per unit of risk. Amplify ETF Trust is currently generating about -0.02 per unit of risk. If you would invest 25.00 in Aquagold International on November 19, 2024 and sell it today you would lose (24.96) from holding Aquagold International or give up 99.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.38% |
| Values | Daily Returns |
Aquagold International vs. Amplify ETF Trust
Performance |
| Timeline |
| Aquagold International |
| Amplify ETF Trust |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Aquagold International and Amplify ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aquagold International and Amplify ETF
The main advantage of trading using opposite Aquagold International and Amplify ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquagold International position performs unexpectedly, Amplify ETF 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 Amplify ETF will offset losses from the drop in Amplify ETF's long position.| Aquagold International vs. PepsiCo | Aquagold International vs. Coca Cola Consolidated | Aquagold International vs. Monster Beverage Corp | Aquagold International vs. Celsius Holdings |
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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 the Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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