Correlation Between ProShares Trust and VanEck Morningstar
Can any of the company-specific risk be diversified away by investing in both ProShares Trust and VanEck Morningstar 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 ProShares Trust and VanEck Morningstar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Trust and VanEck Morningstar International, you can compare the effects of market volatilities on ProShares Trust and VanEck Morningstar 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 ProShares Trust with a short position of VanEck Morningstar. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Trust and VanEck Morningstar.
Diversification Opportunities for ProShares Trust and VanEck Morningstar
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ProShares and VanEck is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Trust and VanEck Morningstar Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Morningstar and ProShares Trust 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 ProShares Trust are associated (or correlated) with VanEck Morningstar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Morningstar has no effect on the direction of ProShares Trust i.e., ProShares Trust and VanEck Morningstar go up and down completely randomly.
Pair Corralation between ProShares Trust and VanEck Morningstar
Given the investment horizon of 90 days ProShares Trust is expected to generate 4.1 times more return on investment than VanEck Morningstar. However, ProShares Trust is 4.1 times more volatile than VanEck Morningstar International. It trades about 0.04 of its potential returns per unit of risk. VanEck Morningstar International is currently generating about 0.02 per unit of risk. If you would invest 8,378 in ProShares Trust on October 22, 2024 and sell it today you would earn a total of 273.60 from holding ProShares Trust or generate 3.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Trust vs. VanEck Morningstar Internation
Performance |
| Timeline |
| ProShares Trust |
| VanEck Morningstar |
ProShares Trust and VanEck Morningstar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Trust and VanEck Morningstar
The main advantage of trading using opposite ProShares Trust and VanEck Morningstar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Trust position performs unexpectedly, VanEck Morningstar 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 VanEck Morningstar will offset losses from the drop in VanEck Morningstar's long position.| ProShares Trust vs. ProShares Trust | ProShares Trust vs. iShares Ethereum Trust | ProShares Trust vs. ProShares Trust | ProShares Trust vs. Grayscale Ethereum Trust |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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