Correlation Between ProShares Trust and Alger ETF
Can any of the company-specific risk be diversified away by investing in both ProShares Trust and Alger ETF 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 Alger ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Trust and The Alger ETF, you can compare the effects of market volatilities on ProShares Trust and Alger ETF 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 Alger ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Trust and Alger ETF.
Diversification Opportunities for ProShares Trust and Alger ETF
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ProShares and Alger is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Trust and The Alger ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger ETF 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 Alger ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger ETF has no effect on the direction of ProShares Trust i.e., ProShares Trust and Alger ETF go up and down completely randomly.
Pair Corralation between ProShares Trust and Alger ETF
Given the investment horizon of 90 days ProShares Trust is expected to under-perform the Alger ETF. In addition to that, ProShares Trust is 2.77 times more volatile than The Alger ETF. It trades about -0.24 of its total potential returns per unit of risk. The Alger ETF is currently generating about 0.2 per unit of volatility. If you would invest 2,495 in The Alger ETF on August 29, 2024 and sell it today you would earn a total of 275.00 from holding The Alger ETF or generate 11.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Trust vs. The Alger ETF
Performance |
| Timeline |
| ProShares Trust |
| Alger ETF |
ProShares Trust and Alger ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Trust and Alger ETF
The main advantage of trading using opposite ProShares Trust and Alger ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Trust position performs unexpectedly, Alger ETF 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 Alger ETF will offset losses from the drop in Alger ETF's long position.| ProShares Trust vs. AXS TSLA Bear | ProShares Trust vs. Tuttle Capital Short | ProShares Trust vs. ProShares Bitcoin Strategy | ProShares Trust vs. ProShares UltraShort Bloomberg |
| Alger ETF vs. JPMorgan Fundamental Data | Alger ETF vs. Vanguard Mid Cap Index | Alger ETF vs. SPDR SP 400 | Alger ETF vs. SPDR SP 400 |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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