Correlation Between Amplify CWP and Morgan Stanley
Can any of the company-specific risk be diversified away by investing in both Amplify CWP and Morgan Stanley 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 Morgan Stanley 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 Morgan Stanley ETF, you can compare the effects of market volatilities on Amplify CWP and Morgan Stanley 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 Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify CWP and Morgan Stanley.
Diversification Opportunities for Amplify CWP and Morgan Stanley
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amplify and Morgan is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Amplify CWP Enhanced and Morgan Stanley ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley ETF 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 Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley ETF has no effect on the direction of Amplify CWP i.e., Amplify CWP and Morgan Stanley go up and down completely randomly.
Pair Corralation between Amplify CWP and Morgan Stanley
Given the investment horizon of 90 days Amplify CWP is expected to generate 1.01 times less return on investment than Morgan Stanley. But when comparing it to its historical volatility, Amplify CWP Enhanced is 1.13 times less risky than Morgan Stanley. It trades about 0.13 of its potential returns per unit of risk. Morgan Stanley ETF is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,293 in Morgan Stanley ETF on September 2, 2024 and sell it today you would earn a total of 508.00 from holding Morgan Stanley ETF or generate 22.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 75.81% |
| Values | Daily Returns |
Amplify CWP Enhanced vs. Morgan Stanley ETF
Performance |
| Timeline |
| Amplify CWP Enhanced |
| Morgan Stanley ETF |
Amplify CWP and Morgan Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify CWP and Morgan Stanley
The main advantage of trading using opposite Amplify CWP and Morgan Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify CWP position performs unexpectedly, Morgan Stanley 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 Morgan Stanley will offset losses from the drop in Morgan Stanley'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 |
| Morgan Stanley vs. Global X Dow | Morgan Stanley vs. AdvisorShares STAR Global | Morgan Stanley vs. Global X Funds | Morgan Stanley 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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