Correlation Between IShares Global and Amplify ETF
Can any of the company-specific risk be diversified away by investing in both IShares Global 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 IShares Global and Amplify ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Global 100 and Amplify ETF Trust, you can compare the effects of market volatilities on IShares Global 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 IShares Global with a short position of Amplify ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Global and Amplify ETF.
Diversification Opportunities for IShares Global and Amplify ETF
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and Amplify is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding iShares Global 100 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 IShares 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 iShares Global 100 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 IShares Global i.e., IShares Global and Amplify ETF go up and down completely randomly.
Pair Corralation between IShares Global and Amplify ETF
Considering the 90-day investment horizon IShares Global is expected to generate 1.58 times less return on investment than Amplify ETF. In addition to that, IShares Global is 1.04 times more volatile than Amplify ETF Trust. It trades about 0.16 of its total potential returns per unit of risk. Amplify ETF Trust is currently generating about 0.26 per unit of volatility. If you would invest 2,137 in Amplify ETF Trust on September 2, 2024 and sell it today you would earn a total of 83.00 from holding Amplify ETF Trust or generate 3.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Global 100 vs. Amplify ETF Trust
Performance |
| Timeline |
| iShares Global 100 |
| Amplify ETF Trust |
IShares Global and Amplify ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Global and Amplify ETF
The main advantage of trading using opposite IShares Global and Amplify ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Global 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.| IShares Global vs. iShares Europe ETF | IShares Global vs. iShares Global Financials | IShares Global vs. iShares Global Healthcare | IShares Global vs. iShares Global Comm |
| Amplify ETF vs. Amplify BlackSwan ISWN | Amplify ETF vs. Amplify BlackSwan Growth | Amplify ETF vs. Amplify Thematic All Stars | Amplify ETF vs. Amplify ETF Trust |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |