Correlation Between Virtus ETF and Amplify Thematic

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

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

Diversification Opportunities for Virtus ETF and Amplify Thematic

0.17

Correlation Coefficient

Virtus ETF  Amplify Thematic

Average diversification

The 3 months correlation between Virtus and Amplify is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Virtus ETF Trust and Amplify Thematic All Stars in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify Thematic All and Virtus 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 Virtus ETF Trust are associated (or correlated) with Amplify Thematic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify Thematic All has no effect on the direction of Virtus ETF i.e., Virtus ETF and Amplify Thematic go up and down completely randomly.

Pair Corralation between Virtus ETF and Amplify Thematic

Given the investment horizon of 90 days Virtus ETF Trust is expected to generate 0.75 times more return on investment than Amplify Thematic. However, Virtus ETF Trust is 1.33 times less risky than Amplify Thematic. It trades about -0.04 of its potential returns per unit of risk. Amplify Thematic All Stars is currently generating about -0.09 per unit of risk. If you would invest  3,882  in Virtus ETF Trust on December 26, 2024 and sell it today you would lose (108.00) from holding Virtus ETF Trust or give up 2.78% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	81.67%
Values	Daily Returns

Virtus ETF Trust  vs.  Amplify Thematic All Stars

Virtus ETF Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Virtus ETF Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Virtus ETF is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Amplify Thematic All

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amplify Thematic All Stars 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 stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the exchange-traded fund private investors.

Pair Trading with Virtus ETF and Amplify Thematic

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

The idea behind Virtus ETF Trust and Amplify Thematic All Stars 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .