Correlation Between ProShares Big and Fidelity Covington
Can any of the company-specific risk be diversified away by investing in both ProShares Big and Fidelity Covington 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 Big and Fidelity Covington into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Big Data and Fidelity Covington Trust, you can compare the effects of market volatilities on ProShares Big and Fidelity Covington 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 Big with a short position of Fidelity Covington. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Big and Fidelity Covington.
Diversification Opportunities for ProShares Big and Fidelity Covington
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ProShares and Fidelity is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Big Data and Fidelity Covington Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Covington Trust and ProShares Big 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 Big Data are associated (or correlated) with Fidelity Covington. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Covington Trust has no effect on the direction of ProShares Big i.e., ProShares Big and Fidelity Covington go up and down completely randomly.
Pair Corralation between ProShares Big and Fidelity Covington
Considering the 90-day investment horizon ProShares Big Data is expected to generate 0.92 times more return on investment than Fidelity Covington. However, ProShares Big Data is 1.09 times less risky than Fidelity Covington. It trades about 0.09 of its potential returns per unit of risk. Fidelity Covington Trust is currently generating about -0.05 per unit of risk. If you would invest 2,870 in ProShares Big Data on September 2, 2024 and sell it today you would earn a total of 1,713 from holding ProShares Big Data or generate 59.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Big Data vs. Fidelity Covington Trust
Performance |
| Timeline |
| ProShares Big Data |
| Fidelity Covington Trust |
ProShares Big and Fidelity Covington Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Big and Fidelity Covington
The main advantage of trading using opposite ProShares Big and Fidelity Covington positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Big position performs unexpectedly, Fidelity Covington 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 Fidelity Covington will offset losses from the drop in Fidelity Covington's long position.| ProShares Big vs. ProShares SP Kensho | ProShares Big vs. ProShares SP Kensho | ProShares Big vs. ProShares Smart Materials | ProShares Big vs. ProShares On Demand ETF |
| Fidelity Covington vs. Fidelity Covington Trust | Fidelity Covington vs. Fidelity Covington Trust | Fidelity Covington vs. Fidelity Covington Trust | Fidelity Covington vs. Fidelity Crypto Industry |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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