Correlation Between ProShares Long and ProShares Short
Can any of the company-specific risk be diversified away by investing in both ProShares Long 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 ProShares Long and ProShares Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Long OnlineShort and ProShares Short FTSE, you can compare the effects of market volatilities on ProShares Long 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 ProShares Long with a short position of ProShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Long and ProShares Short.
Diversification Opportunities for ProShares Long and ProShares Short
-0.95 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ProShares and ProShares is -0.95. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Long OnlineShort and ProShares Short FTSE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Short FTSE and ProShares Long 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 Long OnlineShort 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 FTSE has no effect on the direction of ProShares Long i.e., ProShares Long and ProShares Short go up and down completely randomly.
Pair Corralation between ProShares Long and ProShares Short
Given the investment horizon of 90 days ProShares Long OnlineShort is expected to generate 0.73 times more return on investment than ProShares Short. However, ProShares Long OnlineShort is 1.37 times less risky than ProShares Short. It trades about 0.06 of its potential returns per unit of risk. ProShares Short FTSE is currently generating about -0.01 per unit of risk. If you would invest 3,178 in ProShares Long OnlineShort on August 30, 2024 and sell it today you would earn a total of 1,462 from holding ProShares Long OnlineShort or generate 46.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Long OnlineShort vs. ProShares Short FTSE
Performance |
| Timeline |
| ProShares Long Onlin |
| ProShares Short FTSE |
ProShares Long and ProShares Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Long and ProShares Short
The main advantage of trading using opposite ProShares Long and ProShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Long 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.| ProShares Long vs. ProShares Online Retail | ProShares Long vs. Amplify Online Retail | ProShares Long vs. ProShares Decline of | ProShares Long vs. Global X E commerce |
| ProShares Short vs. ProShares Ultra FTSE | ProShares Short vs. ProShares Short MSCI | ProShares Short vs. ProShares Short MSCI | ProShares Short vs. ProShares Short Real |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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