Correlation Between Amplify CWP and SPDR Portfolio
Can any of the company-specific risk be diversified away by investing in both Amplify CWP and SPDR Portfolio 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 SPDR Portfolio 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 SPDR Portfolio SP, you can compare the effects of market volatilities on Amplify CWP and SPDR Portfolio 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 SPDR Portfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify CWP and SPDR Portfolio.
Diversification Opportunities for Amplify CWP and SPDR Portfolio
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amplify and SPDR is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Amplify CWP Enhanced and SPDR Portfolio SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Portfolio SP 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 SPDR Portfolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Portfolio SP has no effect on the direction of Amplify CWP i.e., Amplify CWP and SPDR Portfolio go up and down completely randomly.
Pair Corralation between Amplify CWP and SPDR Portfolio
Given the investment horizon of 90 days Amplify CWP is expected to generate 1.45 times less return on investment than SPDR Portfolio. But when comparing it to its historical volatility, Amplify CWP Enhanced is 1.3 times less risky than SPDR Portfolio. It trades about 0.09 of its potential returns per unit of risk. SPDR Portfolio SP is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 3,787 in SPDR Portfolio SP on August 30, 2024 and sell it today you would earn a total of 1,725 from holding SPDR Portfolio SP or generate 45.55% 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. SPDR Portfolio SP
Performance |
| Timeline |
| Amplify CWP Enhanced |
| SPDR Portfolio SP |
Amplify CWP and SPDR Portfolio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify CWP and SPDR Portfolio
The main advantage of trading using opposite Amplify CWP and SPDR Portfolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify CWP position performs unexpectedly, SPDR Portfolio 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 SPDR Portfolio will offset losses from the drop in SPDR Portfolio'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 |
| SPDR Portfolio vs. SPDR Portfolio SP | SPDR Portfolio vs. SPDR Portfolio SP | SPDR Portfolio vs. SPDR Portfolio SP | SPDR Portfolio vs. SPDR SP 600 |
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.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |