Correlation Between Amplify BlackSwan and Invesco SP
Can any of the company-specific risk be diversified away by investing in both Amplify BlackSwan and Invesco SP 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 Invesco SP 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 Invesco SP 500, you can compare the effects of market volatilities on Amplify BlackSwan and Invesco SP 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 Invesco SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify BlackSwan and Invesco SP.
Diversification Opportunities for Amplify BlackSwan and Invesco SP
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amplify and Invesco is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Amplify BlackSwan Growth and Invesco SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco SP 500 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 Invesco SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco SP 500 has no effect on the direction of Amplify BlackSwan i.e., Amplify BlackSwan and Invesco SP go up and down completely randomly.
Pair Corralation between Amplify BlackSwan and Invesco SP
Given the investment horizon of 90 days Amplify BlackSwan is expected to generate 1.09 times less return on investment than Invesco SP. In addition to that, Amplify BlackSwan is 1.36 times more volatile than Invesco SP 500. It trades about 0.17 of its total potential returns per unit of risk. Invesco SP 500 is currently generating about 0.25 per unit of volatility. If you would invest 2,259 in Invesco SP 500 on August 31, 2024 and sell it today you would earn a total of 66.00 from holding Invesco SP 500 or generate 2.92% 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. Invesco SP 500
Performance |
| Timeline |
| Amplify BlackSwan Growth |
| Invesco SP 500 |
Amplify BlackSwan and Invesco SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amplify BlackSwan and Invesco SP
The main advantage of trading using opposite Amplify BlackSwan and Invesco SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify BlackSwan position performs unexpectedly, Invesco SP 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 Invesco SP will offset losses from the drop in Invesco SP's long position.| Amplify BlackSwan vs. Aptus Collared Income | Amplify BlackSwan vs. Core Alternative ETF | Amplify BlackSwan vs. Aptus Drawdown Managed | Amplify BlackSwan vs. Invesco SP 500 |
| Invesco SP vs. Global X Russell | Invesco SP vs. Global X SP | Invesco SP vs. Global X NASDAQ | Invesco SP vs. Amplify CWP Enhanced |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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