Correlation Between NYSE Composite and Amplify Thematic
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Amplify Thematic 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 NYSE Composite and Amplify Thematic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Amplify Thematic All Stars, you can compare the effects of market volatilities on NYSE Composite and Amplify Thematic 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 NYSE Composite with a short position of Amplify Thematic. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Amplify Thematic.
Diversification Opportunities for NYSE Composite and Amplify Thematic
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NYSE and Amplify is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Amplify Thematic All Stars in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify Thematic All and NYSE Composite 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 NYSE Composite are associated (or correlated) with Amplify Thematic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify Thematic All has no effect on the direction of NYSE Composite i.e., NYSE Composite and Amplify Thematic go up and down completely randomly.
Pair Corralation between NYSE Composite and Amplify Thematic
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.59 times less return on investment than Amplify Thematic. But when comparing it to its historical volatility, NYSE Composite is 2.07 times less risky than Amplify Thematic. It trades about 0.08 of its potential returns per unit of risk. Amplify Thematic All Stars is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,604 in Amplify Thematic All Stars on August 30, 2024 and sell it today you would earn a total of 807.00 from holding Amplify Thematic All Stars or generate 50.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Amplify Thematic All Stars
Performance |
| Timeline |
NYSE Composite and Amplify Thematic Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Amplify Thematic All Stars
Pair trading matchups for Amplify Thematic
Pair Trading with NYSE Composite and Amplify Thematic
The main advantage of trading using opposite NYSE Composite and Amplify Thematic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Amplify Thematic 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 Thematic will offset losses from the drop in Amplify Thematic's long position.| NYSE Composite vs. Sphere Entertainment Co | NYSE Composite vs. Weibo Corp | NYSE Composite vs. BCE Inc | NYSE Composite vs. Pinterest |
| Amplify Thematic vs. Nexalin Technology | Amplify Thematic vs. Kilroy Realty Corp | Amplify Thematic vs. Highwoods Properties | Amplify Thematic vs. Karat Packaging |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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