Correlation Between Invesco SP and Amplify BlackSwan
Can any of the company-specific risk be diversified away by investing in both Invesco SP 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 Invesco SP and Amplify BlackSwan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco SP 500 and Amplify BlackSwan Growth, you can compare the effects of market volatilities on Invesco SP 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 Invesco SP with a short position of Amplify BlackSwan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco SP and Amplify BlackSwan.
Diversification Opportunities for Invesco SP and Amplify BlackSwan
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Invesco and Amplify is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Invesco SP 500 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 Invesco SP 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 Invesco SP 500 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 Invesco SP i.e., Invesco SP and Amplify BlackSwan go up and down completely randomly.
Pair Corralation between Invesco SP and Amplify BlackSwan
Given the investment horizon of 90 days Invesco SP is expected to generate 1.06 times less return on investment than Amplify BlackSwan. But when comparing it to its historical volatility, Invesco SP 500 is 1.22 times less risky than Amplify BlackSwan. It trades about 0.2 of its potential returns per unit of risk. Amplify BlackSwan Growth is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 2,959 in Amplify BlackSwan Growth on November 18, 2024 and sell it today you would earn a total of 66.00 from holding Amplify BlackSwan Growth or generate 2.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco SP 500 vs. Amplify BlackSwan Growth
Performance |
| Timeline |
| Invesco SP 500 |
| Amplify BlackSwan Growth |
Invesco SP and Amplify BlackSwan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco SP and Amplify BlackSwan
The main advantage of trading using opposite Invesco SP and Amplify BlackSwan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco SP 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.| Invesco SP vs. Invesco DWA Emerging | Invesco SP vs. First Trust LongShort | Invesco SP vs. Amplify BlackSwan Growth | Invesco SP vs. Invesco SP 500 |
| 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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