Correlation Between Fidelity Crypto and ProShares Metaverse
Can any of the company-specific risk be diversified away by investing in both Fidelity Crypto and ProShares Metaverse 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 Fidelity Crypto and ProShares Metaverse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Crypto Industry and ProShares Metaverse ETF, you can compare the effects of market volatilities on Fidelity Crypto and ProShares Metaverse 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 Fidelity Crypto with a short position of ProShares Metaverse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Crypto and ProShares Metaverse.
Diversification Opportunities for Fidelity Crypto and ProShares Metaverse
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and ProShares is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Crypto Industry and ProShares Metaverse ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Metaverse ETF and Fidelity Crypto 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 Fidelity Crypto Industry are associated (or correlated) with ProShares Metaverse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Metaverse ETF has no effect on the direction of Fidelity Crypto i.e., Fidelity Crypto and ProShares Metaverse go up and down completely randomly.
Pair Corralation between Fidelity Crypto and ProShares Metaverse
Given the investment horizon of 90 days Fidelity Crypto Industry is expected to generate 2.6 times more return on investment than ProShares Metaverse. However, Fidelity Crypto is 2.6 times more volatile than ProShares Metaverse ETF. It trades about 0.08 of its potential returns per unit of risk. ProShares Metaverse ETF is currently generating about 0.07 per unit of risk. If you would invest 1,135 in Fidelity Crypto Industry on August 30, 2024 and sell it today you would earn a total of 2,798 from holding Fidelity Crypto Industry or generate 246.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Crypto Industry vs. ProShares Metaverse ETF
Performance |
| Timeline |
| Fidelity Crypto Industry |
| ProShares Metaverse ETF |
Fidelity Crypto and ProShares Metaverse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Crypto and ProShares Metaverse
The main advantage of trading using opposite Fidelity Crypto and ProShares Metaverse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Crypto position performs unexpectedly, ProShares Metaverse 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 Metaverse will offset losses from the drop in ProShares Metaverse's long position.| Fidelity Crypto vs. Fidelity Metaverse ETF | Fidelity Crypto vs. iShares Blockchain and | Fidelity Crypto vs. Fidelity Covington Trust | Fidelity Crypto vs. Fidelity Covington Trust |
| ProShares Metaverse vs. Roundhill Ball Metaverse | ProShares Metaverse vs. Deltagen | ProShares Metaverse vs. Fidelity Metaverse ETF |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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