Correlation Between Fidelity MSCI and Amplify ETF
Can any of the company-specific risk be diversified away by investing in both Fidelity MSCI and Amplify ETF 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 Fidelity MSCI and Amplify ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity MSCI Consumer and Amplify ETF Trust, you can compare the effects of market volatilities on Fidelity MSCI and Amplify ETF 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 Fidelity MSCI with a short position of Amplify ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity MSCI and Amplify ETF.
Diversification Opportunities for Fidelity MSCI and Amplify ETF
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Amplify is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity MSCI Consumer and Amplify ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify ETF Trust and Fidelity MSCI 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 Fidelity MSCI Consumer are associated (or correlated) with Amplify ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify ETF Trust has no effect on the direction of Fidelity MSCI i.e., Fidelity MSCI and Amplify ETF go up and down completely randomly.
Pair Corralation between Fidelity MSCI and Amplify ETF
Given the investment horizon of 90 days Fidelity MSCI Consumer is expected to generate 0.9 times more return on investment than Amplify ETF. However, Fidelity MSCI Consumer is 1.11 times less risky than Amplify ETF. It trades about 0.08 of its potential returns per unit of risk. Amplify ETF Trust is currently generating about 0.04 per unit of risk. If you would invest 6,081 in Fidelity MSCI Consumer on August 26, 2024 and sell it today you would earn a total of 3,486 from holding Fidelity MSCI Consumer or generate 57.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity MSCI Consumer vs. Amplify ETF Trust
Performance |
| Timeline |
| Fidelity MSCI Consumer |
| Amplify ETF Trust |
Fidelity MSCI and Amplify ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity MSCI and Amplify ETF
The main advantage of trading using opposite Fidelity MSCI and Amplify ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity MSCI position performs unexpectedly, Amplify ETF 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 ETF will offset losses from the drop in Amplify ETF's long position.| Fidelity MSCI vs. Fidelity MSCI Consumer | Fidelity MSCI vs. Fidelity MSCI Industrials | Fidelity MSCI vs. Fidelity MSCI Financials | Fidelity MSCI vs. Fidelity MSCI Communication |
| Amplify ETF vs. Invesco Dynamic Leisure | Amplify ETF vs. US Global Jets | Amplify ETF vs. Global X Infrastructure | Amplify ETF vs. ProShares Online Retail |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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