Correlation Between TrueShares Technology and Amplify ETF

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

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

Diversification Opportunities for TrueShares Technology and Amplify ETF

0.23

Correlation Coefficient

TrueShares Technology  Amplify ETF

Modest diversification

The 3 months correlation between TrueShares and Amplify is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding TrueShares Technology AI and Amplify ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify ETF Trust and TrueShares Technology 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 TrueShares Technology AI are associated (or correlated) with Amplify ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify ETF Trust has no effect on the direction of TrueShares Technology i.e., TrueShares Technology and Amplify ETF go up and down completely randomly.

Pair Corralation between TrueShares Technology and Amplify ETF

Given the investment horizon of 90 days TrueShares Technology AI is expected to generate 1.26 times more return on investment than Amplify ETF. However, TrueShares Technology is 1.26 times more volatile than Amplify ETF Trust. It trades about 0.06 of its potential returns per unit of risk. Amplify ETF Trust is currently generating about 0.08 per unit of risk. If you would invest  2,440  in TrueShares Technology AI on October 11, 2024 and sell it today you would earn a total of  1,550  from holding TrueShares Technology AI or generate 63.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	88.91%
Values	Daily Returns

TrueShares Technology AI  vs.  Amplify ETF Trust

TrueShares Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TrueShares Technology AI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, TrueShares Technology is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

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. In spite of latest unsteady performance, the Etf's technical and fundamental 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 TrueShares Technology and Amplify ETF

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

The idea behind TrueShares Technology AI and Amplify ETF 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.