Correlation Between BetaPro NASDAQ and IShares SPTSX
Can any of the company-specific risk be diversified away by investing in both BetaPro NASDAQ and IShares SPTSX 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 NASDAQ and IShares SPTSX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BetaPro NASDAQ 100 2x and iShares SPTSX 60, you can compare the effects of market volatilities on BetaPro NASDAQ and IShares SPTSX 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 NASDAQ with a short position of IShares SPTSX. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaPro NASDAQ and IShares SPTSX.
Diversification Opportunities for BetaPro NASDAQ and IShares SPTSX
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BetaPro and IShares is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro NASDAQ 100 2x and iShares SPTSX 60 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares SPTSX 60 and BetaPro NASDAQ 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 NASDAQ 100 2x are associated (or correlated) with IShares SPTSX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares SPTSX 60 has no effect on the direction of BetaPro NASDAQ i.e., BetaPro NASDAQ and IShares SPTSX go up and down completely randomly.
Pair Corralation between BetaPro NASDAQ and IShares SPTSX
Assuming the 90 days trading horizon BetaPro NASDAQ 100 2x is expected to under-perform the IShares SPTSX. In addition to that, BetaPro NASDAQ is 2.47 times more volatile than iShares SPTSX 60. It trades about -0.11 of its total potential returns per unit of risk. iShares SPTSX 60 is currently generating about -0.04 per unit of volatility. If you would invest 3,863 in iShares SPTSX 60 on November 27, 2024 and sell it today you would lose (24.00) from holding iShares SPTSX 60 or give up 0.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BetaPro NASDAQ 100 2x vs. iShares SPTSX 60
Performance |
| Timeline |
| BetaPro NASDAQ 100 |
| iShares SPTSX 60 |
BetaPro NASDAQ and IShares SPTSX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BetaPro NASDAQ and IShares SPTSX
The main advantage of trading using opposite BetaPro NASDAQ and IShares SPTSX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BetaPro NASDAQ position performs unexpectedly, IShares SPTSX 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 IShares SPTSX will offset losses from the drop in IShares SPTSX's long position.| BetaPro NASDAQ vs. BetaPro SP 500 | BetaPro NASDAQ vs. BetaPro NASDAQ 100 2x | BetaPro NASDAQ vs. BetaPro SP 500 | BetaPro NASDAQ vs. BetaPro SPTSX 60 |
| IShares SPTSX vs. iShares Core SP | IShares SPTSX vs. iShares Core SPTSX | IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. iShares SPTSX Capped |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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