Correlation Between BetaPro Crude and First Trust
Can any of the company-specific risk be diversified away by investing in both BetaPro Crude and First Trust 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 BetaPro Crude and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BetaPro Crude Oil and First Trust Canadian, you can compare the effects of market volatilities on BetaPro Crude and First Trust 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 BetaPro Crude with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaPro Crude and First Trust.
Diversification Opportunities for BetaPro Crude and First Trust
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BetaPro and First is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro Crude Oil and First Trust Canadian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Canadian and BetaPro Crude 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 BetaPro Crude Oil are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Canadian has no effect on the direction of BetaPro Crude i.e., BetaPro Crude and First Trust go up and down completely randomly.
Pair Corralation between BetaPro Crude and First Trust
Assuming the 90 days trading horizon BetaPro Crude is expected to generate 7.88 times less return on investment than First Trust. In addition to that, BetaPro Crude is 4.87 times more volatile than First Trust Canadian. It trades about 0.0 of its total potential returns per unit of risk. First Trust Canadian is currently generating about 0.08 per unit of volatility. If you would invest 7,143 in First Trust Canadian on September 27, 2025 and sell it today you would earn a total of 71.00 from holding First Trust Canadian or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BetaPro Crude Oil vs. First Trust Canadian
Performance |
| Timeline |
| BetaPro Crude Oil |
| First Trust Canadian |
BetaPro Crude and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BetaPro Crude and First Trust
The main advantage of trading using opposite BetaPro Crude and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BetaPro Crude position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| BetaPro Crude vs. BetaPro Crude Oil | BetaPro Crude vs. BetaPro Natural Gas | BetaPro Crude vs. Brompton Flaherty Crumrine | BetaPro Crude vs. BMO Conservative ETF |
| First Trust vs. iShares ESG Equity | First Trust vs. iShares MSCI Min | First Trust vs. Invesco RAFI Canadian | First Trust vs. Desjardins RI Developed |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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