Correlation Between Simplify Exchange and EA Series

Can any of the company-specific risk be diversified away by investing in both Simplify Exchange and EA Series 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 Simplify Exchange and EA Series into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Simplify Exchange Traded and EA Series Trust, you can compare the effects of market volatilities on Simplify Exchange and EA Series 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 Simplify Exchange with a short position of EA Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simplify Exchange and EA Series.

Diversification Opportunities for Simplify Exchange and EA Series

0.1

Correlation Coefficient

Simplify Exchange  EA Series

Average diversification

The 3 months correlation between Simplify and EMPB is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Simplify Exchange Traded and EA Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EA Series Trust and Simplify Exchange 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 Simplify Exchange Traded are associated (or correlated) with EA Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EA Series Trust has no effect on the direction of Simplify Exchange i.e., Simplify Exchange and EA Series go up and down completely randomly.

Pair Corralation between Simplify Exchange and EA Series

Given the investment horizon of 90 days Simplify Exchange Traded is expected to under-perform the EA Series. But the etf apears to be less risky and, when comparing its historical volatility, Simplify Exchange Traded is 243.71 times less risky than EA Series. The etf trades about -0.02 of its potential returns per unit of risk. The EA Series Trust is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  0.00  in EA Series Trust on October 23, 2024 and sell it today you would earn a total of  2,533  from holding EA Series Trust or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	43.33%
Values	Daily Returns

Simplify Exchange Traded  vs.  EA Series Trust

Simplify Exchange Traded

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Simplify Exchange Traded has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Simplify Exchange is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

EA Series Trust

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in EA Series Trust are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, EA Series sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Simplify Exchange and EA Series

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

The idea behind Simplify Exchange Traded and EA Series 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.

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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.