Correlation Between Amplify BlackSwan and IShares Core
Can any of the company-specific risk be diversified away by investing in both Amplify BlackSwan and IShares Core 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 IShares Core 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 iShares Core Growth, you can compare the effects of market volatilities on Amplify BlackSwan and IShares Core 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 IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify BlackSwan and IShares Core.
Diversification Opportunities for Amplify BlackSwan and IShares Core
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amplify and IShares is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Amplify BlackSwan Growth and iShares Core Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core Growth 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 IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core Growth has no effect on the direction of Amplify BlackSwan i.e., Amplify BlackSwan and IShares Core go up and down completely randomly.
Pair Corralation between Amplify BlackSwan and IShares Core
Given the investment horizon of 90 days Amplify BlackSwan Growth is expected to generate 1.64 times more return on investment than IShares Core. However, Amplify BlackSwan is 1.64 times more volatile than iShares Core Growth. It trades about 0.14 of its potential returns per unit of risk. iShares Core Growth is currently generating about 0.08 per unit of risk. If you would invest 2,998 in Amplify BlackSwan Growth on August 30, 2024 and sell it today you would earn a total of 67.00 from holding Amplify BlackSwan Growth or generate 2.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amplify BlackSwan Growth vs. iShares Core Growth
Performance |
| Timeline |
| Amplify BlackSwan Growth |
| iShares Core Growth |
Amplify BlackSwan and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify BlackSwan and IShares Core
The main advantage of trading using opposite Amplify BlackSwan and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify BlackSwan position performs unexpectedly, IShares Core 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 IShares Core will offset losses from the drop in IShares Core's long position.The idea behind Amplify BlackSwan Growth and iShares Core Growth pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| IShares Core vs. iShares Core Moderate | IShares Core vs. iShares Core Aggressive | IShares Core vs. iShares Core Conservative | IShares Core vs. Vanguard Mega 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |