Correlation Between GraniteShares ETF and ProShares Short
Can any of the company-specific risk be diversified away by investing in both GraniteShares 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 GraniteShares 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 GraniteShares ETF Trust and ProShares Short QQQ, you can compare the effects of market volatilities on GraniteShares 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 GraniteShares ETF with a short position of ProShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares ETF and ProShares Short.
Diversification Opportunities for GraniteShares ETF and ProShares Short
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GraniteShares and ProShares is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares ETF Trust and ProShares Short QQQ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Short QQQ and GraniteShares 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 GraniteShares ETF Trust 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 QQQ has no effect on the direction of GraniteShares ETF i.e., GraniteShares ETF and ProShares Short go up and down completely randomly.
Pair Corralation between GraniteShares ETF and ProShares Short
Given the investment horizon of 90 days GraniteShares ETF Trust is expected to generate 9.18 times more return on investment than ProShares Short. However, GraniteShares ETF is 9.18 times more volatile than ProShares Short QQQ. It trades about 0.06 of its potential returns per unit of risk. ProShares Short QQQ is currently generating about -0.06 per unit of risk. If you would invest 5,100 in GraniteShares ETF Trust on September 1, 2024 and sell it today you would earn a total of 238.00 from holding GraniteShares ETF Trust or generate 4.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GraniteShares ETF Trust vs. ProShares Short QQQ
Performance |
| Timeline |
| GraniteShares ETF Trust |
| ProShares Short QQQ |
GraniteShares ETF and ProShares Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares ETF and ProShares Short
The main advantage of trading using opposite GraniteShares ETF and ProShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares 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.| GraniteShares ETF vs. GraniteShares ETF Trust | GraniteShares ETF vs. Direxion Shares ETF | GraniteShares ETF vs. Direxion Daily AMZN | GraniteShares ETF vs. Direxion Daily GOOGL |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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