Correlation Between Innovator ETFs and AXS 125X
Can any of the company-specific risk be diversified away by investing in both Innovator ETFs and AXS 125X 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 Innovator ETFs and AXS 125X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator ETFs Trust and AXS 125X NVDA, you can compare the effects of market volatilities on Innovator ETFs and AXS 125X 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 Innovator ETFs with a short position of AXS 125X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator ETFs and AXS 125X.
Diversification Opportunities for Innovator ETFs and AXS 125X
-0.95 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Innovator and AXS is -0.95. Overlapping area represents the amount of risk that can be diversified away by holding Innovator ETFs Trust and AXS 125X NVDA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXS 125X NVDA and Innovator ETFs 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 Innovator ETFs Trust are associated (or correlated) with AXS 125X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXS 125X NVDA has no effect on the direction of Innovator ETFs i.e., Innovator ETFs and AXS 125X go up and down completely randomly.
Pair Corralation between Innovator ETFs and AXS 125X
Given the investment horizon of 90 days Innovator ETFs Trust is expected to generate 0.08 times more return on investment than AXS 125X. However, Innovator ETFs Trust is 12.47 times less risky than AXS 125X. It trades about 0.18 of its potential returns per unit of risk. AXS 125X NVDA is currently generating about -0.01 per unit of risk. If you would invest 2,461 in Innovator ETFs Trust on August 26, 2024 and sell it today you would earn a total of 28.00 from holding Innovator ETFs Trust or generate 1.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovator ETFs Trust vs. AXS 125X NVDA
Performance |
| Timeline |
| Innovator ETFs Trust |
| AXS 125X NVDA |
Innovator ETFs and AXS 125X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator ETFs and AXS 125X
The main advantage of trading using opposite Innovator ETFs and AXS 125X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator ETFs position performs unexpectedly, AXS 125X 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 AXS 125X will offset losses from the drop in AXS 125X's long position.| Innovator ETFs vs. Innovator Growth Accelerated | Innovator ETFs vs. Innovator ETFs Trust | Innovator ETFs vs. Innovator ETFs Trust | Innovator ETFs vs. Innovator ETFs Trust |
| AXS 125X vs. AXS TSLA Bear | AXS 125X vs. Direxion Shares ETF | AXS 125X vs. Direxion Shares ETF | AXS 125X vs. Direxion Shares ETF |
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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