Correlation Between Global X and Amplify ETF

Can any of the company-specific risk be diversified away by investing in both Global X and Amplify ETF 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 Global X and Amplify ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Global X Disruptive and Amplify ETF Trust, you can compare the effects of market volatilities on Global X and Amplify ETF 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 Global X with a short position of Amplify ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Amplify ETF.

Diversification Opportunities for Global X and Amplify ETF

-0.23

Correlation Coefficient

Global X  Amplify ETF

Very good diversification

The 3 months correlation between Global and Amplify is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Global X Disruptive and Amplify ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify ETF Trust and Global X 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 Global X Disruptive are associated (or correlated) with Amplify ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify ETF Trust has no effect on the direction of Global X i.e., Global X and Amplify ETF go up and down completely randomly.

Pair Corralation between Global X and Amplify ETF

Given the investment horizon of 90 days Global X Disruptive is expected to generate 0.78 times more return on investment than Amplify ETF. However, Global X Disruptive is 1.28 times less risky than Amplify ETF. It trades about 0.13 of its potential returns per unit of risk. Amplify ETF Trust is currently generating about -0.11 per unit of risk. If you would invest  1,312  in Global X Disruptive on September 12, 2024 and sell it today you would earn a total of  261.00  from holding Global X Disruptive or generate 19.89% return on investment over 90 days.

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

Global X Disruptive  vs.  Amplify ETF Trust

Global X Disruptive

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Disruptive are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Global X unveiled solid returns over the last few months and may actually be approaching a breakup point.

Amplify ETF Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amplify ETF Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Etf's forward-looking indicators remain relatively steady which may send shares a bit higher in January 2025. The new chaos may also be a sign of medium-term up-swing for the ETF firm stakeholders.

Pair Trading with Global X and Amplify ETF

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

The idea behind Global X Disruptive and Amplify ETF Trust 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.