Correlation Between Amplify Cash and IShares Trust
Can any of the company-specific risk be diversified away by investing in both Amplify Cash and IShares Trust 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 Amplify Cash and IShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amplify Cash Flow and iShares Trust , you can compare the effects of market volatilities on Amplify Cash and IShares Trust 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 Amplify Cash with a short position of IShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify Cash and IShares Trust.
Diversification Opportunities for Amplify Cash and IShares Trust
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amplify and IShares is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Amplify Cash Flow and iShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Trust and Amplify Cash 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 Amplify Cash Flow are associated (or correlated) with IShares Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Trust has no effect on the direction of Amplify Cash i.e., Amplify Cash and IShares Trust go up and down completely randomly.
Pair Corralation between Amplify Cash and IShares Trust
Given the investment horizon of 90 days Amplify Cash Flow is expected to generate 1.05 times more return on investment than IShares Trust. However, Amplify Cash is 1.05 times more volatile than iShares Trust . It trades about 0.39 of its potential returns per unit of risk. iShares Trust is currently generating about 0.35 per unit of risk. If you would invest 2,938 in Amplify Cash Flow on September 4, 2024 and sell it today you would earn a total of 252.00 from holding Amplify Cash Flow or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amplify Cash Flow vs. iShares Trust
Performance |
| Timeline |
| Amplify Cash Flow |
| iShares Trust |
Amplify Cash and IShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify Cash and IShares Trust
The main advantage of trading using opposite Amplify Cash and IShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify Cash position performs unexpectedly, IShares Trust 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 IShares Trust will offset losses from the drop in IShares Trust's long position.| Amplify Cash vs. FT Vest Equity | Amplify Cash vs. Northern Lights | Amplify Cash vs. Dimensional International High | Amplify Cash vs. JPMorgan Fundamental Data |
| IShares Trust vs. Vanguard Growth Index | IShares Trust vs. iShares Russell 1000 | IShares Trust vs. iShares Core SP | IShares Trust vs. Vanguard Mega Cap |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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