Correlation Between Tema ETF and ProShares Bitcoin
Can any of the company-specific risk be diversified away by investing in both Tema ETF and ProShares Bitcoin 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 Tema ETF and ProShares Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tema ETF Trust and ProShares Bitcoin Strategy, you can compare the effects of market volatilities on Tema ETF and ProShares Bitcoin 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 Tema ETF with a short position of ProShares Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tema ETF and ProShares Bitcoin.
Diversification Opportunities for Tema ETF and ProShares Bitcoin
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tema and ProShares is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Tema ETF Trust and ProShares Bitcoin Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Bitcoin and Tema ETF 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 Tema ETF Trust are associated (or correlated) with ProShares Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Bitcoin has no effect on the direction of Tema ETF i.e., Tema ETF and ProShares Bitcoin go up and down completely randomly.
Pair Corralation between Tema ETF and ProShares Bitcoin
Considering the 90-day investment horizon Tema ETF Trust is expected to under-perform the ProShares Bitcoin. But the etf apears to be less risky and, when comparing its historical volatility, Tema ETF Trust is 4.9 times less risky than ProShares Bitcoin. The etf trades about -0.13 of its potential returns per unit of risk. The ProShares Bitcoin Strategy is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,961 in ProShares Bitcoin Strategy on August 30, 2024 and sell it today you would earn a total of 638.00 from holding ProShares Bitcoin Strategy or generate 32.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tema ETF Trust vs. ProShares Bitcoin Strategy
Performance |
| Timeline |
| Tema ETF Trust |
| ProShares Bitcoin |
Tema ETF and ProShares Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tema ETF and ProShares Bitcoin
The main advantage of trading using opposite Tema ETF and ProShares Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tema ETF position performs unexpectedly, ProShares Bitcoin 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 Bitcoin will offset losses from the drop in ProShares Bitcoin's long position.| Tema ETF vs. Consumer Discretionary Select | Tema ETF vs. Vanguard Consumer Discretionary | Tema ETF vs. iShares Home Construction | Tema ETF vs. Fidelity MSCI Consumer |
| ProShares Bitcoin vs. Grayscale Bitcoin Trust | ProShares Bitcoin vs. Grayscale Ethereum Trust | ProShares Bitcoin vs. Coinbase Global | ProShares Bitcoin vs. Valkyrie Bitcoin Strategy |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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