Correlation Between Alphabet and YieldMax

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

By analyzing existing cross correlation between Alphabet Inc Class C and YieldMax SP 500, you can compare the effects of market volatilities on Alphabet and YieldMax 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 Alphabet with a short position of YieldMax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphabet and YieldMax.

Diversification Opportunities for Alphabet and YieldMax

0.9

Correlation Coefficient

Alphabet  YieldMax

Almost no diversification

The 3 months correlation between Alphabet and YieldMax is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Alphabet Inc Class C and YieldMax SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YieldMax SP 500 and Alphabet 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 Alphabet Inc Class C are associated (or correlated) with YieldMax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YieldMax SP 500 has no effect on the direction of Alphabet i.e., Alphabet and YieldMax go up and down completely randomly.

Pair Corralation between Alphabet and YieldMax

Given the investment horizon of 90 days Alphabet Inc Class C is expected to generate 3.42 times more return on investment than YieldMax. However, Alphabet is 3.42 times more volatile than YieldMax SP 500. It trades about 0.3 of its potential returns per unit of risk. YieldMax SP 500 is currently generating about 0.2 per unit of risk. If you would invest  17,960  in Alphabet Inc Class C on July 2, 2025 and sell it today you would earn a total of  6,395  from holding Alphabet Inc Class C or generate 35.61% return on investment over 90 days.

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

Alphabet Inc Class C  vs.  YieldMax SP 500

Alphabet Class C

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Alphabet Inc Class C are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting basic indicators, Alphabet reported solid returns over the last few months and may actually be approaching a breakup point.

YieldMax SP 500

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in YieldMax SP 500 are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, YieldMax is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alphabet and YieldMax

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

The idea behind Alphabet Inc Class C and YieldMax SP 500 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .