Correlation Between MasTec and PROSHARES ULTRASHORT
Can any of the company-specific risk be diversified away by investing in both MasTec and PROSHARES ULTRASHORT 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 MasTec and PROSHARES ULTRASHORT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MasTec Inc and PROSHARES ULTRASHORT RUSSELL, you can compare the effects of market volatilities on MasTec and PROSHARES ULTRASHORT 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 MasTec with a short position of PROSHARES ULTRASHORT. Check out your portfolio center. Please also check ongoing floating volatility patterns of MasTec and PROSHARES ULTRASHORT.
Diversification Opportunities for MasTec and PROSHARES ULTRASHORT
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MasTec and PROSHARES is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding MasTec Inc and PROSHARES ULTRASHORT RUSSELL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PROSHARES ULTRASHORT and MasTec 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 MasTec Inc are associated (or correlated) with PROSHARES ULTRASHORT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PROSHARES ULTRASHORT has no effect on the direction of MasTec i.e., MasTec and PROSHARES ULTRASHORT go up and down completely randomly.
Pair Corralation between MasTec and PROSHARES ULTRASHORT
Considering the 90-day investment horizon MasTec is expected to generate 3.66 times less return on investment than PROSHARES ULTRASHORT. But when comparing it to its historical volatility, MasTec Inc is 7.6 times less risky than PROSHARES ULTRASHORT. It trades about 0.38 of its potential returns per unit of risk. PROSHARES ULTRASHORT RUSSELL is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 74.00 in PROSHARES ULTRASHORT RUSSELL on October 21, 2024 and sell it today you would earn a total of 31.00 from holding PROSHARES ULTRASHORT RUSSELL or generate 41.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
MasTec Inc vs. PROSHARES ULTRASHORT RUSSELL
Performance |
| Timeline |
| MasTec Inc |
| PROSHARES ULTRASHORT |
MasTec and PROSHARES ULTRASHORT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MasTec and PROSHARES ULTRASHORT
The main advantage of trading using opposite MasTec and PROSHARES ULTRASHORT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MasTec position performs unexpectedly, PROSHARES ULTRASHORT 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 ULTRASHORT will offset losses from the drop in PROSHARES ULTRASHORT's long position.| MasTec vs. EMCOR Group | MasTec vs. Comfort Systems USA | MasTec vs. Primoris Services | MasTec vs. Granite Construction Incorporated |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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