Correlation Between Amplify Online and Global X
Can any of the company-specific risk be diversified away by investing in both Amplify Online and Global X 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 Online and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amplify Online Retail and Global X Cloud, you can compare the effects of market volatilities on Amplify Online and Global X 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 Online with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify Online and Global X.
Diversification Opportunities for Amplify Online and Global X
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amplify and Global is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Amplify Online Retail and Global X Cloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Cloud and Amplify Online 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 Online Retail are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Cloud has no effect on the direction of Amplify Online i.e., Amplify Online and Global X go up and down completely randomly.
Pair Corralation between Amplify Online and Global X
Given the investment horizon of 90 days Amplify Online is expected to generate 1.72 times less return on investment than Global X. But when comparing it to its historical volatility, Amplify Online Retail is 1.23 times less risky than Global X. It trades about 0.23 of its potential returns per unit of risk. Global X Cloud is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 2,032 in Global X Cloud on August 26, 2024 and sell it today you would earn a total of 418.00 from holding Global X Cloud or generate 20.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amplify Online Retail vs. Global X Cloud
Performance |
| Timeline |
| Amplify Online Retail |
| Global X Cloud |
Amplify Online and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify Online and Global X
The main advantage of trading using opposite Amplify Online and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify Online position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| Amplify Online vs. ProShares Online Retail | Amplify Online vs. WisdomTree Cloud Computing | Amplify Online vs. Amplify ETF Trust | Amplify Online vs. Global X Cloud |
| Global X vs. Invesco DWA Utilities | Global X vs. Invesco Dynamic Large | Global X vs. Invesco Dynamic Large | Global X vs. HUMANA INC |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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