Correlation Between Profunds-large Cap and Falling Dollar
Can any of the company-specific risk be diversified away by investing in both Profunds-large Cap and Falling Dollar 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 Profunds-large Cap and Falling Dollar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Profunds Large Cap Growth and Falling Dollar Profund, you can compare the effects of market volatilities on Profunds-large Cap and Falling Dollar 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 Profunds-large Cap with a short position of Falling Dollar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Profunds-large Cap and Falling Dollar.
Diversification Opportunities for Profunds-large Cap and Falling Dollar
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Profunds-large and Falling is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Profunds Large Cap Growth and Falling Dollar Profund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Falling Dollar Profund and Profunds-large Cap 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 Profunds Large Cap Growth are associated (or correlated) with Falling Dollar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Falling Dollar Profund has no effect on the direction of Profunds-large Cap i.e., Profunds-large Cap and Falling Dollar go up and down completely randomly.
Pair Corralation between Profunds-large Cap and Falling Dollar
Assuming the 90 days horizon Profunds Large Cap Growth is expected to generate 2.14 times more return on investment than Falling Dollar. However, Profunds-large Cap is 2.14 times more volatile than Falling Dollar Profund. It trades about 0.13 of its potential returns per unit of risk. Falling Dollar Profund is currently generating about -0.15 per unit of risk. If you would invest 3,355 in Profunds Large Cap Growth on August 24, 2024 and sell it today you would earn a total of 104.00 from holding Profunds Large Cap Growth or generate 3.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Profunds Large Cap Growth vs. Falling Dollar Profund
Performance |
| Timeline |
| Profunds Large Cap |
| Falling Dollar Profund |
Profunds-large Cap and Falling Dollar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Profunds-large Cap and Falling Dollar
The main advantage of trading using opposite Profunds-large Cap and Falling Dollar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Profunds-large Cap position performs unexpectedly, Falling Dollar 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 Falling Dollar will offset losses from the drop in Falling Dollar's long position.| Profunds-large Cap vs. Schwab Treasury Money | Profunds-large Cap vs. Matson Money Equity | Profunds-large Cap vs. Pioneer Money Market | Profunds-large Cap vs. Edward Jones Money |
| Falling Dollar vs. Short Real Estate | Falling Dollar vs. HUMANA INC | Falling Dollar vs. Aquagold International | Falling Dollar vs. Barloworld Ltd ADR |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |