Correlation Between Mast Global and Amplify Lithium
Can any of the company-specific risk be diversified away by investing in both Mast Global and Amplify Lithium 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 Mast Global and Amplify Lithium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mast Global Battery and Amplify Lithium Battery, you can compare the effects of market volatilities on Mast Global and Amplify Lithium 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 Mast Global with a short position of Amplify Lithium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mast Global and Amplify Lithium.
Diversification Opportunities for Mast Global and Amplify Lithium
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mast and Amplify is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Mast Global Battery and Amplify Lithium Battery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify Lithium Battery and Mast Global 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 Mast Global Battery are associated (or correlated) with Amplify Lithium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify Lithium Battery has no effect on the direction of Mast Global i.e., Mast Global and Amplify Lithium go up and down completely randomly.
Pair Corralation between Mast Global and Amplify Lithium
Allowing for the 90-day total investment horizon Mast Global Battery is expected to under-perform the Amplify Lithium. But the etf apears to be less risky and, when comparing its historical volatility, Mast Global Battery is 1.05 times less risky than Amplify Lithium. The etf trades about -0.05 of its potential returns per unit of risk. The Amplify Lithium Battery is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 960.00 in Amplify Lithium Battery on August 28, 2024 and sell it today you would lose (13.00) from holding Amplify Lithium Battery or give up 1.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 97.67% |
| Values | Daily Returns |
Mast Global Battery vs. Amplify Lithium Battery
Performance |
| Timeline |
| Mast Global Battery |
| Amplify Lithium Battery |
Mast Global and Amplify Lithium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mast Global and Amplify Lithium
The main advantage of trading using opposite Mast Global and Amplify Lithium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mast Global position performs unexpectedly, Amplify Lithium 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 Lithium will offset losses from the drop in Amplify Lithium's long position.| Mast Global vs. iShares Dividend and | Mast Global vs. Martin Currie Sustainable | Mast Global vs. VictoryShares THB Mid | Mast Global vs. AdvisorShares Gerber Kawasaki |
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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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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