Correlation Between Vanguard Small and Amplify BlackSwan
Can any of the company-specific risk be diversified away by investing in both Vanguard Small 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 Vanguard Small and Amplify BlackSwan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Small Cap Index and Amplify BlackSwan ISWN, you can compare the effects of market volatilities on Vanguard Small 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 Vanguard Small with a short position of Amplify BlackSwan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Small and Amplify BlackSwan.
Diversification Opportunities for Vanguard Small and Amplify BlackSwan
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Vanguard and Amplify is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Small Cap Index and Amplify BlackSwan ISWN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify BlackSwan ISWN and Vanguard Small 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 Vanguard Small Cap Index 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 ISWN has no effect on the direction of Vanguard Small i.e., Vanguard Small and Amplify BlackSwan go up and down completely randomly.
Pair Corralation between Vanguard Small and Amplify BlackSwan
Allowing for the 90-day total investment horizon Vanguard Small Cap Index is expected to generate 1.38 times more return on investment than Amplify BlackSwan. However, Vanguard Small is 1.38 times more volatile than Amplify BlackSwan ISWN. It trades about 0.08 of its potential returns per unit of risk. Amplify BlackSwan ISWN is currently generating about 0.01 per unit of risk. If you would invest 19,089 in Vanguard Small Cap Index on September 2, 2024 and sell it today you would earn a total of 6,962 from holding Vanguard Small Cap Index or generate 36.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Small Cap Index vs. Amplify BlackSwan ISWN
Performance |
| Timeline |
| Vanguard Small Cap |
| Amplify BlackSwan ISWN |
Vanguard Small and Amplify BlackSwan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Small and Amplify BlackSwan
The main advantage of trading using opposite Vanguard Small and Amplify BlackSwan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Small 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.| Vanguard Small vs. Vanguard Mid Cap Index | Vanguard Small vs. Vanguard Small Cap Value | Vanguard Small vs. Vanguard FTSE Emerging | Vanguard Small vs. Vanguard Large Cap Index |
| Amplify BlackSwan vs. Amplify BlackSwan Growth | Amplify BlackSwan vs. Amplify ETF Trust | Amplify BlackSwan vs. Amplify Thematic All Stars | 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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