Correlation Between ETF Series and Amplify BlackSwan
Can any of the company-specific risk be diversified away by investing in both ETF Series and Amplify BlackSwan 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 ETF Series and Amplify BlackSwan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETF Series Solutions and Amplify BlackSwan Growth, you can compare the effects of market volatilities on ETF Series and Amplify BlackSwan 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 ETF Series with a short position of Amplify BlackSwan. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETF Series and Amplify BlackSwan.
Diversification Opportunities for ETF Series and Amplify BlackSwan
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ETF and Amplify is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding ETF Series Solutions and Amplify BlackSwan Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify BlackSwan Growth and ETF Series 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 ETF Series Solutions are associated (or correlated) with Amplify BlackSwan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify BlackSwan Growth has no effect on the direction of ETF Series i.e., ETF Series and Amplify BlackSwan go up and down completely randomly.
Pair Corralation between ETF Series and Amplify BlackSwan
Given the investment horizon of 90 days ETF Series Solutions is expected to generate 1.2 times more return on investment than Amplify BlackSwan. However, ETF Series is 1.2 times more volatile than Amplify BlackSwan Growth. It trades about 0.06 of its potential returns per unit of risk. Amplify BlackSwan Growth is currently generating about 0.03 per unit of risk. If you would invest 3,365 in ETF Series Solutions on August 23, 2024 and sell it today you would earn a total of 92.00 from holding ETF Series Solutions or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ETF Series Solutions vs. Amplify BlackSwan Growth
Performance |
| Timeline |
| ETF Series Solutions |
| Amplify BlackSwan Growth |
ETF Series and Amplify BlackSwan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ETF Series and Amplify BlackSwan
The main advantage of trading using opposite ETF Series and Amplify BlackSwan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETF Series position performs unexpectedly, Amplify BlackSwan 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 BlackSwan will offset losses from the drop in Amplify BlackSwan's long position.| ETF Series vs. Aptus Collared Income | ETF Series vs. Core Alternative ETF | ETF Series vs. Aptus Drawdown Managed | ETF Series vs. Amplify BlackSwan Growth |
| Amplify BlackSwan vs. WisdomTree 9060 Balanced | Amplify BlackSwan vs. RPAR Risk Parity | Amplify BlackSwan vs. Cambria Tail Risk | Amplify BlackSwan vs. Aptus Defined Risk |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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