Correlation Between Amplify CWP and Blackrock Advantage
Can any of the company-specific risk be diversified away by investing in both Amplify CWP and Blackrock Advantage 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 CWP and Blackrock Advantage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amplify CWP Enhanced and Blackrock Advantage Large, you can compare the effects of market volatilities on Amplify CWP and Blackrock Advantage 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 CWP with a short position of Blackrock Advantage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify CWP and Blackrock Advantage.
Diversification Opportunities for Amplify CWP and Blackrock Advantage
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amplify and Blackrock is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Amplify CWP Enhanced and Blackrock Advantage Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Advantage Large and Amplify CWP 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 CWP Enhanced are associated (or correlated) with Blackrock Advantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Advantage Large has no effect on the direction of Amplify CWP i.e., Amplify CWP and Blackrock Advantage go up and down completely randomly.
Pair Corralation between Amplify CWP and Blackrock Advantage
Given the investment horizon of 90 days Amplify CWP is expected to generate 1.12 times less return on investment than Blackrock Advantage. But when comparing it to its historical volatility, Amplify CWP Enhanced is 1.04 times less risky than Blackrock Advantage. It trades about 0.14 of its potential returns per unit of risk. Blackrock Advantage Large is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 3,004 in Blackrock Advantage Large on August 30, 2024 and sell it today you would earn a total of 134.00 from holding Blackrock Advantage Large or generate 4.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amplify CWP Enhanced vs. Blackrock Advantage Large
Performance |
| Timeline |
| Amplify CWP Enhanced |
| Blackrock Advantage Large |
Amplify CWP and Blackrock Advantage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify CWP and Blackrock Advantage
The main advantage of trading using opposite Amplify CWP and Blackrock Advantage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify CWP position performs unexpectedly, Blackrock Advantage 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 Blackrock Advantage will offset losses from the drop in Blackrock Advantage's long position.| Amplify CWP vs. NEOS ETF Trust | Amplify CWP vs. Global X SP | Amplify CWP vs. Global X Russell | Amplify CWP vs. JPMorgan Equity Premium |
| Blackrock Advantage vs. FT Vest Equity | Blackrock Advantage vs. Northern Lights | Blackrock Advantage vs. Dimensional International High | Blackrock Advantage vs. First Trust Exchange Traded |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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