Correlation Between Managed Account and ProShares Pet
Can any of the company-specific risk be diversified away by investing in both Managed Account and ProShares Pet 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 Managed Account and ProShares Pet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Managed Account Series and ProShares Pet Care, you can compare the effects of market volatilities on Managed Account and ProShares Pet 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 Managed Account with a short position of ProShares Pet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Managed Account and ProShares Pet.
Diversification Opportunities for Managed Account and ProShares Pet
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Managed and ProShares is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Managed Account Series and ProShares Pet Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Pet Care and Managed Account 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 Managed Account Series are associated (or correlated) with ProShares Pet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Pet Care has no effect on the direction of Managed Account i.e., Managed Account and ProShares Pet go up and down completely randomly.
Pair Corralation between Managed Account and ProShares Pet
Assuming the 90 days horizon Managed Account Series is expected to generate 0.28 times more return on investment than ProShares Pet. However, Managed Account Series is 3.59 times less risky than ProShares Pet. It trades about 0.15 of its potential returns per unit of risk. ProShares Pet Care is currently generating about -0.04 per unit of risk. If you would invest 895.00 in Managed Account Series on September 3, 2024 and sell it today you would earn a total of 5.00 from holding Managed Account Series or generate 0.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Managed Account Series vs. ProShares Pet Care
Performance |
| Timeline |
| Managed Account Series |
| ProShares Pet Care |
Managed Account and ProShares Pet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Managed Account and ProShares Pet
The main advantage of trading using opposite Managed Account and ProShares Pet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Managed Account position performs unexpectedly, ProShares Pet 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 Pet will offset losses from the drop in ProShares Pet's long position.| Managed Account vs. Dreyfus Natural Resources | Managed Account vs. Fidelity Advisor Energy | Managed Account vs. Goehring Rozencwajg Resources | Managed Account vs. Gmo Resources |
| ProShares Pet vs. Managed Account Series | ProShares Pet vs. Fidelity Sai International | ProShares Pet vs. Schwab Strategic Trust | ProShares Pet vs. Inpex Corp 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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