Correlation Between ProShares and Invesco BuyBack
Can any of the company-specific risk be diversified away by investing in both ProShares and Invesco BuyBack 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 and Invesco BuyBack into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares SP 500 and Invesco BuyBack Achievers, you can compare the effects of market volatilities on ProShares and Invesco BuyBack 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 with a short position of Invesco BuyBack. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares and Invesco BuyBack.
Diversification Opportunities for ProShares and Invesco BuyBack
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and Invesco is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding ProShares SP 500 and Invesco BuyBack Achievers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco BuyBack Achievers and ProShares 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 SP 500 are associated (or correlated) with Invesco BuyBack. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco BuyBack Achievers has no effect on the direction of ProShares i.e., ProShares and Invesco BuyBack go up and down completely randomly.
Pair Corralation between ProShares and Invesco BuyBack
Given the investment horizon of 90 days ProShares is expected to generate 2.04 times less return on investment than Invesco BuyBack. But when comparing it to its historical volatility, ProShares SP 500 is 1.19 times less risky than Invesco BuyBack. It trades about 0.08 of its potential returns per unit of risk. Invesco BuyBack Achievers is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 8,799 in Invesco BuyBack Achievers on August 28, 2024 and sell it today you would earn a total of 3,645 from holding Invesco BuyBack Achievers or generate 41.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares SP 500 vs. Invesco BuyBack Achievers
Performance |
| Timeline |
| ProShares SP 500 |
| Invesco BuyBack Achievers |
ProShares and Invesco BuyBack Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares and Invesco BuyBack
The main advantage of trading using opposite ProShares and Invesco BuyBack positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares position performs unexpectedly, Invesco BuyBack 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 Invesco BuyBack will offset losses from the drop in Invesco BuyBack's long position.| ProShares vs. iShares Core Dividend | ProShares vs. SPDR SP Dividend | ProShares vs. Invesco SP 500 | ProShares vs. Vanguard Dividend Appreciation |
| Invesco BuyBack vs. BlackRock ETF Trust | Invesco BuyBack vs. Rbb Fund | Invesco BuyBack vs. Virtus ETF Trust | Invesco BuyBack vs. Amplify CWP Enhanced |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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