Correlation Between Cisco Systems and Amplify Cash
Can any of the company-specific risk be diversified away by investing in both Cisco Systems and Amplify Cash 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 Cisco Systems and Amplify Cash into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cisco Systems and Amplify Cash Flow, you can compare the effects of market volatilities on Cisco Systems and Amplify Cash 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 Cisco Systems with a short position of Amplify Cash. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and Amplify Cash.
Diversification Opportunities for Cisco Systems and Amplify Cash
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cisco and Amplify is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and Amplify Cash Flow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify Cash Flow and Cisco Systems 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 Cisco Systems are associated (or correlated) with Amplify Cash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify Cash Flow has no effect on the direction of Cisco Systems i.e., Cisco Systems and Amplify Cash go up and down completely randomly.
Pair Corralation between Cisco Systems and Amplify Cash
Given the investment horizon of 90 days Cisco Systems is expected to generate 1.16 times less return on investment than Amplify Cash. In addition to that, Cisco Systems is 1.21 times more volatile than Amplify Cash Flow. It trades about 0.05 of its total potential returns per unit of risk. Amplify Cash Flow is currently generating about 0.07 per unit of volatility. If you would invest 2,245 in Amplify Cash Flow on September 2, 2024 and sell it today you would earn a total of 513.00 from holding Amplify Cash Flow or generate 22.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 81.45% |
| Values | Daily Returns |
Cisco Systems vs. Amplify Cash Flow
Performance |
| Timeline |
| Cisco Systems |
| Amplify Cash Flow |
Cisco Systems and Amplify Cash Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cisco Systems and Amplify Cash
The main advantage of trading using opposite Cisco Systems and Amplify Cash positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems position performs unexpectedly, Amplify Cash 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 Cash will offset losses from the drop in Amplify Cash's long position.| Cisco Systems vs. Juniper Networks | Cisco Systems vs. Nokia Corp ADR | Cisco Systems vs. Motorola Solutions | Cisco Systems vs. Ciena Corp |
| Amplify Cash vs. Global X Dow | Amplify Cash vs. AdvisorShares STAR Global | Amplify Cash vs. Global X Funds | Amplify Cash vs. FT Vest Dow |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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