Correlation Between IShares Russell and Amplify

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

By analyzing existing cross correlation between iShares Russell 2000 and Amplify, you can compare the effects of market volatilities on IShares Russell and Amplify 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 IShares Russell with a short position of Amplify. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Russell and Amplify.

Diversification Opportunities for IShares Russell and Amplify

0.0

Correlation Coefficient

IShares Russell  Amplify

Pay attention - limited upside

The 3 months correlation between IShares and Amplify is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding iShares Russell 2000 and Amplify in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify and IShares Russell 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 iShares Russell 2000 are associated (or correlated) with Amplify. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify has no effect on the direction of IShares Russell i.e., IShares Russell and Amplify go up and down completely randomly.

Pair Corralation between IShares Russell and Amplify

If you would invest (100.00) in Amplify on December 20, 2024 and sell it today you would earn a total of  100.00  from holding Amplify or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

iShares Russell 2000  vs.  Amplify

iShares Russell 2000

Risk-Adjusted Performance

Very Weak

Over the last 90 days iShares Russell 2000 has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating 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.

Amplify

Risk-Adjusted Performance

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 fairly strong basic indicators, Amplify is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with IShares Russell and Amplify

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

The idea behind iShares Russell 2000 and Amplify 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.