Correlation Between Tidal Trust and YieldMax N

Can any of the company-specific risk be diversified away by investing in both Tidal Trust and YieldMax N 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 Tidal Trust and YieldMax N into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tidal Trust II and YieldMax N Option, you can compare the effects of market volatilities on Tidal Trust and YieldMax N 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 Tidal Trust with a short position of YieldMax N. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal Trust and YieldMax N.

Diversification Opportunities for Tidal Trust and YieldMax N

0.41

Correlation Coefficient

Tidal Trust  YieldMax N

Very weak diversification

The 3 months correlation between Tidal and YieldMax is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Tidal Trust II and YieldMax N Option in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YieldMax N Option and Tidal Trust 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 Tidal Trust II are associated (or correlated) with YieldMax N. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YieldMax N Option has no effect on the direction of Tidal Trust i.e., Tidal Trust and YieldMax N go up and down completely randomly.

Pair Corralation between Tidal Trust and YieldMax N

Given the investment horizon of 90 days Tidal Trust II is expected to generate 0.31 times more return on investment than YieldMax N. However, Tidal Trust II is 3.23 times less risky than YieldMax N. It trades about -0.12 of its potential returns per unit of risk. YieldMax N Option is currently generating about -0.12 per unit of risk. If you would invest  1,558  in Tidal Trust II on December 19, 2024 and sell it today you would lose (133.00) from holding Tidal Trust II or give up 8.54% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Tidal Trust II  vs.  YieldMax N Option

Tidal Trust II

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tidal Trust II has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Etf's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

YieldMax N Option

Risk-Adjusted Performance

Very Weak

Over the last 90 days YieldMax N Option has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the ETF investors.

Pair Trading with Tidal Trust and YieldMax N

The main advantage of trading using opposite Tidal Trust and YieldMax N positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidal Trust position performs unexpectedly, YieldMax N 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 YieldMax N will offset losses from the drop in YieldMax N's long position.

The idea behind Tidal Trust II and YieldMax N Option 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.

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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.