Correlation Between ProShares Inflation and FolioBeyond Rising
Can any of the company-specific risk be diversified away by investing in both ProShares Inflation and FolioBeyond Rising 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 Inflation and FolioBeyond Rising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Inflation Expectations and FolioBeyond Rising Rates, you can compare the effects of market volatilities on ProShares Inflation and FolioBeyond Rising 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 Inflation with a short position of FolioBeyond Rising. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Inflation and FolioBeyond Rising.
Diversification Opportunities for ProShares Inflation and FolioBeyond Rising
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ProShares and FolioBeyond is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Inflation Expectatio and FolioBeyond Rising Rates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FolioBeyond Rising Rates and ProShares Inflation 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 Inflation Expectations are associated (or correlated) with FolioBeyond Rising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FolioBeyond Rising Rates has no effect on the direction of ProShares Inflation i.e., ProShares Inflation and FolioBeyond Rising go up and down completely randomly.
Pair Corralation between ProShares Inflation and FolioBeyond Rising
Given the investment horizon of 90 days ProShares Inflation Expectations is expected to generate 1.69 times more return on investment than FolioBeyond Rising. However, ProShares Inflation is 1.69 times more volatile than FolioBeyond Rising Rates. It trades about -0.04 of its potential returns per unit of risk. FolioBeyond Rising Rates is currently generating about -0.07 per unit of risk. If you would invest 3,302 in ProShares Inflation Expectations on August 29, 2024 and sell it today you would lose (18.00) from holding ProShares Inflation Expectations or give up 0.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Inflation Expectatio vs. FolioBeyond Rising Rates
Performance |
| Timeline |
| ProShares Inflation |
| FolioBeyond Rising Rates |
ProShares Inflation and FolioBeyond Rising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Inflation and FolioBeyond Rising
The main advantage of trading using opposite ProShares Inflation and FolioBeyond Rising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Inflation position performs unexpectedly, FolioBeyond Rising 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 FolioBeyond Rising will offset losses from the drop in FolioBeyond Rising's long position.| ProShares Inflation vs. SPDR SSgA Multi Asset | ProShares Inflation vs. ProShares Hedge Replication | ProShares Inflation vs. ProShares Short 7 10 | ProShares Inflation vs. ProShares Merger ETF |
| FolioBeyond Rising vs. WisdomTree Interest Rate | FolioBeyond Rising vs. WisdomTree SmallCap Quality | FolioBeyond Rising vs. WisdomTree Emerging Markets | FolioBeyond Rising vs. WisdomTree Emerging Markets |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |