Correlation Between Amplify ETF and EERN

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

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

Diversification Opportunities for Amplify ETF and EERN

0.0

Correlation Coefficient

Amplify ETF  EERN

Pay attention - limited upside

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

Pair Corralation between Amplify ETF and EERN

If you would invest (100.00) in EERN on January 26, 2024 and sell it today you would earn a total of  100.00  from holding EERN 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

Amplify ETF Trust  vs.  EERN

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. Even with relatively invariable technical and fundamental indicators, Amplify ETF is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

EERN

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Amplify ETF and EERN

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

The idea behind Amplify ETF Trust and EERN 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.