Correlation Between Chevron Corp and Amplify High

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

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

Diversification Opportunities for Chevron Corp and Amplify High

0.86

Correlation Coefficient

Chevron Corp  Amplify High

Very poor diversification

The 3 months correlation between Chevron and Amplify is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Chevron Corp and Amplify High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify High Income and Chevron Corp 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 Chevron Corp are associated (or correlated) with Amplify High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify High Income has no effect on the direction of Chevron Corp i.e., Chevron Corp and Amplify High go up and down completely randomly.

Pair Corralation between Chevron Corp and Amplify High

Considering the 90-day investment horizon Chevron Corp is expected to generate 2.68 times more return on investment than Amplify High. However, Chevron Corp is 2.68 times more volatile than Amplify High Income. It trades about 0.17 of its potential returns per unit of risk. Amplify High Income is currently generating about 0.21 per unit of risk. If you would invest  13,462  in Chevron Corp on May 1, 2025 and sell it today you would earn a total of  1,894  from holding Chevron Corp or generate 14.07% return on investment over 90 days.

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

Chevron Corp  vs.  Amplify High Income

Chevron Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Chevron Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Chevron Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Amplify High Income

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amplify High Income are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Amplify High is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Chevron Corp and Amplify High

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

The idea behind Chevron Corp and Amplify High Income 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..