Correlation Between Amplify ETF and GameSquare Holdings

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

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

Diversification Opportunities for Amplify ETF and GameSquare Holdings

0.41

Correlation Coefficient

Amplify ETF  GameSquare Holdings

Very weak diversification

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

Pair Corralation between Amplify ETF and GameSquare Holdings

Given the investment horizon of 90 days Amplify ETF Trust is expected to generate 0.28 times more return on investment than GameSquare Holdings. However, Amplify ETF Trust is 3.56 times less risky than GameSquare Holdings. It trades about -0.16 of its potential returns per unit of risk. GameSquare Holdings is currently generating about -0.18 per unit of risk. If you would invest  6,899  in Amplify ETF Trust on October 7, 2024 and sell it today you would lose (257.00) from holding Amplify ETF Trust or give up 3.73% of portfolio value over 90 days.

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

Amplify ETF Trust  vs.  GameSquare Holdings

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 relatively invariable primary indicators, Amplify ETF is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

GameSquare Holdings

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in GameSquare Holdings are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent primary indicators, GameSquare Holdings exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amplify ETF and GameSquare Holdings

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

The idea behind Amplify ETF Trust and GameSquare Holdings 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.