Correlation Between Amplify Alternative and IndexIQ

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Can any of the company-specific risk be diversified away by investing in both Amplify Alternative and IndexIQ 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 Alternative and IndexIQ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amplify Alternative Harvest and IndexIQ, you can compare the effects of market volatilities on Amplify Alternative and IndexIQ 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 Alternative with a short position of IndexIQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amplify Alternative and IndexIQ.

Diversification Opportunities for Amplify Alternative and IndexIQ

-0.05
  Correlation Coefficient

Good diversification

The 3 months correlation between Amplify and IndexIQ is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Amplify Alternative Harvest and IndexIQ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IndexIQ and Amplify Alternative 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 Alternative Harvest are associated (or correlated) with IndexIQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IndexIQ has no effect on the direction of Amplify Alternative i.e., Amplify Alternative and IndexIQ go up and down completely randomly.

Pair Corralation between Amplify Alternative and IndexIQ

If you would invest  358.00  in Amplify Alternative Harvest on January 20, 2024 and sell it today you would earn a total of  22.00  from holding Amplify Alternative Harvest or generate 6.15% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Amplify Alternative Harvest  vs.  IndexIQ

 Performance 
       Timeline  
Amplify Alternative 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Amplify Alternative Harvest are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak forward-looking indicators, Amplify Alternative revealed solid returns over the last few months and may actually be approaching a breakup point.
IndexIQ 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days IndexIQ has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, IndexIQ is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Amplify Alternative and IndexIQ Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amplify Alternative and IndexIQ

The main advantage of trading using opposite Amplify Alternative and IndexIQ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amplify Alternative position performs unexpectedly, IndexIQ 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 IndexIQ will offset losses from the drop in IndexIQ's long position.
The idea behind Amplify Alternative Harvest and IndexIQ 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.
Check out your portfolio center.
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

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