Correlation Between Amplify BlackSwan and Aptus Drawdown
Can any of the company-specific risk be diversified away by investing in both Amplify BlackSwan and Aptus Drawdown 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 Amplify BlackSwan and Aptus Drawdown into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amplify BlackSwan Growth and Aptus Drawdown Managed, you can compare the effects of market volatilities on Amplify BlackSwan and Aptus Drawdown 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 Amplify BlackSwan with a short position of Aptus Drawdown. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify BlackSwan and Aptus Drawdown.
Diversification Opportunities for Amplify BlackSwan and Aptus Drawdown
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amplify and Aptus is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Amplify BlackSwan Growth and Aptus Drawdown Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptus Drawdown Managed and Amplify BlackSwan 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 Amplify BlackSwan Growth are associated (or correlated) with Aptus Drawdown. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptus Drawdown Managed has no effect on the direction of Amplify BlackSwan i.e., Amplify BlackSwan and Aptus Drawdown go up and down completely randomly.
Pair Corralation between Amplify BlackSwan and Aptus Drawdown
Given the investment horizon of 90 days Amplify BlackSwan is expected to generate 1.21 times less return on investment than Aptus Drawdown. In addition to that, Amplify BlackSwan is 1.06 times more volatile than Aptus Drawdown Managed. It trades about 0.12 of its total potential returns per unit of risk. Aptus Drawdown Managed is currently generating about 0.16 per unit of volatility. If you would invest 3,690 in Aptus Drawdown Managed on August 26, 2024 and sell it today you would earn a total of 1,057 from holding Aptus Drawdown Managed or generate 28.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amplify BlackSwan Growth vs. Aptus Drawdown Managed
Performance |
| Timeline |
| Amplify BlackSwan Growth |
| Aptus Drawdown Managed |
Amplify BlackSwan and Aptus Drawdown Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify BlackSwan and Aptus Drawdown
The main advantage of trading using opposite Amplify BlackSwan and Aptus Drawdown positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify BlackSwan position performs unexpectedly, Aptus Drawdown 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 Aptus Drawdown will offset losses from the drop in Aptus Drawdown's long position.| Amplify BlackSwan vs. WisdomTree 9060 Balanced | Amplify BlackSwan vs. RPAR Risk Parity | Amplify BlackSwan vs. Cambria Tail Risk | Amplify BlackSwan vs. Aptus Defined Risk |
| Aptus Drawdown vs. Aptus Collared Income | Aptus Drawdown vs. Aptus Defined Risk | Aptus Drawdown vs. Anfield Equity Sector | Aptus Drawdown vs. Opus Small Cap |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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