Correlation Between Amplify and Innovator Loup

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

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

Diversification Opportunities for Amplify and Innovator Loup

0.28

Correlation Coefficient

Amplify  Innovator Loup

Modest diversification

The 3 months correlation between Amplify and Innovator is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Amplify and Innovator Loup Frontier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovator Loup Frontier and Amplify 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 are associated (or correlated) with Innovator Loup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovator Loup Frontier has no effect on the direction of Amplify i.e., Amplify and Innovator Loup go up and down completely randomly.

Pair Corralation between Amplify and Innovator Loup

If you would invest  5,573  in Innovator Loup Frontier on October 26, 2024 and sell it today you would earn a total of  468.00  from holding Innovator Loup Frontier or generate 8.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	5.56%
Values	Daily Returns

Amplify  vs.  Innovator Loup Frontier

Amplify

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amplify has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Amplify is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Innovator Loup Frontier

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Innovator Loup Frontier are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Innovator Loup reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amplify and Innovator Loup

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

The idea behind Amplify and Innovator Loup Frontier 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 Stocks Directory module to find actively traded stocks across global markets.