Correlation Between Roundhill Video and Amplify ETF

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

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

Diversification Opportunities for Roundhill Video and Amplify ETF

0.93

Correlation Coefficient

Roundhill Video  Amplify ETF

Almost no diversification

The 3 months correlation between Roundhill and Amplify is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Roundhill Video Games 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 Roundhill Video 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 Roundhill Video Games 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 Roundhill Video i.e., Roundhill Video and Amplify ETF go up and down completely randomly.

Pair Corralation between Roundhill Video and Amplify ETF

Given the investment horizon of 90 days Roundhill Video Games is expected to generate 1.01 times more return on investment than Amplify ETF. However, Roundhill Video is 1.01 times more volatile than Amplify ETF Trust. It trades about 0.07 of its potential returns per unit of risk. Amplify ETF Trust is currently generating about 0.03 per unit of risk. If you would invest  1,987  in Roundhill Video Games on December 30, 2024 and sell it today you would earn a total of  124.00  from holding Roundhill Video Games or generate 6.24% return on investment over 90 days.

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

Roundhill Video Games  vs.  Amplify ETF Trust

Roundhill Video Games

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Roundhill Video Games are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Roundhill Video may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Amplify ETF Trust

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Amplify ETF Trust are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. 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.

Pair Trading with Roundhill Video and Amplify ETF

The main advantage of trading using opposite Roundhill Video and Amplify ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roundhill Video 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 Roundhill Video Games 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.