Correlation Between 2023 ETF and ProShares Short
Can any of the company-specific risk be diversified away by investing in both 2023 ETF and ProShares Short 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 2023 ETF and ProShares Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 2023 ETF Series and ProShares Short SP500, you can compare the effects of market volatilities on 2023 ETF and ProShares Short 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 2023 ETF with a short position of ProShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of 2023 ETF and ProShares Short.
Diversification Opportunities for 2023 ETF and ProShares Short
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 2023 and ProShares is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding 2023 ETF Series and ProShares Short SP500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Short SP500 and 2023 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 2023 ETF Series are associated (or correlated) with ProShares Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Short SP500 has no effect on the direction of 2023 ETF i.e., 2023 ETF and ProShares Short go up and down completely randomly.
Pair Corralation between 2023 ETF and ProShares Short
Given the investment horizon of 90 days 2023 ETF Series is expected to generate 0.98 times more return on investment than ProShares Short. However, 2023 ETF Series is 1.02 times less risky than ProShares Short. It trades about -0.13 of its potential returns per unit of risk. ProShares Short SP500 is currently generating about -0.33 per unit of risk. If you would invest 3,117 in 2023 ETF Series on September 1, 2024 and sell it today you would lose (67.00) from holding 2023 ETF Series or give up 2.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
2023 ETF Series vs. ProShares Short SP500
Performance |
| Timeline |
| 2023 ETF Series |
| ProShares Short SP500 |
2023 ETF and ProShares Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 2023 ETF and ProShares Short
The main advantage of trading using opposite 2023 ETF and ProShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 2023 ETF position performs unexpectedly, ProShares Short 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 ProShares Short will offset losses from the drop in ProShares Short's long position.| 2023 ETF vs. Schwab Fundamental Small | 2023 ETF vs. Schwab Fundamental Large | 2023 ETF vs. Schwab Fundamental International | 2023 ETF vs. Schwab Fundamental Emerging |
| ProShares Short vs. ProShares Short QQQ | ProShares Short vs. ProShares Short Dow30 | ProShares Short vs. ProShares UltraShort SP500 | ProShares Short vs. ProShares Short Russell2000 |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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