Correlation Between ProShares and YieldMax ABNB
Can any of the company-specific risk be diversified away by investing in both ProShares and YieldMax ABNB 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 YieldMax ABNB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares SP MidCap and YieldMax ABNB Option, you can compare the effects of market volatilities on ProShares and YieldMax ABNB 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 YieldMax ABNB. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares and YieldMax ABNB.
Diversification Opportunities for ProShares and YieldMax ABNB
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and YieldMax is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding ProShares SP MidCap and YieldMax ABNB Option in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YieldMax ABNB Option 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 MidCap are associated (or correlated) with YieldMax ABNB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YieldMax ABNB Option has no effect on the direction of ProShares i.e., ProShares and YieldMax ABNB go up and down completely randomly.
Pair Corralation between ProShares and YieldMax ABNB
Given the investment horizon of 90 days ProShares SP MidCap is expected to generate 0.39 times more return on investment than YieldMax ABNB. However, ProShares SP MidCap is 2.54 times less risky than YieldMax ABNB. It trades about 0.1 of its potential returns per unit of risk. YieldMax ABNB Option is currently generating about -0.07 per unit of risk. If you would invest 7,239 in ProShares SP MidCap on August 25, 2024 and sell it today you would earn a total of 1,525 from holding ProShares SP MidCap or generate 21.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 47.6% |
| Values | Daily Returns |
ProShares SP MidCap vs. YieldMax ABNB Option
Performance |
| Timeline |
| ProShares SP MidCap |
| YieldMax ABNB Option |
ProShares and YieldMax ABNB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares and YieldMax ABNB
The main advantage of trading using opposite ProShares and YieldMax ABNB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares position performs unexpectedly, YieldMax ABNB 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 YieldMax ABNB will offset losses from the drop in YieldMax ABNB's long position.| ProShares vs. Vanguard Mid Cap Index | ProShares vs. Vanguard Extended Market | ProShares vs. iShares Core SP | ProShares vs. SPDR SP MIDCAP |
| YieldMax ABNB vs. Global X SP | YieldMax ABNB vs. First Trust BuyWrite | YieldMax ABNB vs. Amplify CWP Enhanced | YieldMax ABNB vs. ProShares SP MidCap |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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