Correlation Between ProShares Nasdaq and FT Vest
Can any of the company-specific risk be diversified away by investing in both ProShares Nasdaq and FT Vest 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 Nasdaq and FT Vest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Nasdaq 100 High and FT Vest Equity, you can compare the effects of market volatilities on ProShares Nasdaq and FT Vest 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 Nasdaq with a short position of FT Vest. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Nasdaq and FT Vest.
Diversification Opportunities for ProShares Nasdaq and FT Vest
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between ProShares and DHDG is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Nasdaq 100 High and FT Vest Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Vest Equity and ProShares 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 ProShares Nasdaq 100 High are associated (or correlated) with FT Vest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Vest Equity has no effect on the direction of ProShares Nasdaq i.e., ProShares Nasdaq and FT Vest go up and down completely randomly.
Pair Corralation between ProShares Nasdaq and FT Vest
Given the investment horizon of 90 days ProShares Nasdaq 100 High is expected to generate 3.29 times more return on investment than FT Vest. However, ProShares Nasdaq is 3.29 times more volatile than FT Vest Equity. It trades about 0.17 of its potential returns per unit of risk. FT Vest Equity is currently generating about 0.24 per unit of risk. If you would invest 4,299 in ProShares Nasdaq 100 High on September 13, 2024 and sell it today you would earn a total of 138.00 from holding ProShares Nasdaq 100 High or generate 3.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
ProShares Nasdaq 100 High vs. FT Vest Equity
Performance |
| Timeline |
| ProShares Nasdaq 100 |
| FT Vest Equity |
ProShares Nasdaq and FT Vest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Nasdaq and FT Vest
The main advantage of trading using opposite ProShares Nasdaq and FT Vest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Nasdaq position performs unexpectedly, FT Vest 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 FT Vest will offset losses from the drop in FT Vest's long position.| ProShares Nasdaq vs. Global X SP | ProShares Nasdaq vs. Amplify CWP Enhanced | ProShares Nasdaq vs. JPMorgan Nasdaq Equity | ProShares Nasdaq vs. NEOS ETF Trust |
| FT Vest vs. Northern Lights | FT Vest vs. Dimensional International High | FT Vest vs. JPMorgan Fundamental Data | FT Vest vs. Matthews China Discovery |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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