Correlation Between Barclays Capital and ProShares UltraShort
Can any of the company-specific risk be diversified away by investing in both Barclays Capital 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 Barclays Capital and ProShares UltraShort into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barclays Capital and ProShares UltraShort MSCI, you can compare the effects of market volatilities on Barclays Capital 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 Barclays Capital with a short position of ProShares UltraShort. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barclays Capital and ProShares UltraShort.
Diversification Opportunities for Barclays Capital and ProShares UltraShort
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barclays and ProShares is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Barclays Capital and ProShares UltraShort MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares UltraShort MSCI and Barclays Capital 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 Barclays Capital 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 MSCI has no effect on the direction of Barclays Capital i.e., Barclays Capital and ProShares UltraShort go up and down completely randomly.
Pair Corralation between Barclays Capital and ProShares UltraShort
If you would invest 1,004 in ProShares UltraShort MSCI on September 14, 2024 and sell it today you would earn a total of 641.00 from holding ProShares UltraShort MSCI or generate 63.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Barclays Capital vs. ProShares UltraShort MSCI
Performance |
| Timeline |
| Barclays Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| ProShares UltraShort MSCI |
Barclays Capital and ProShares UltraShort Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barclays Capital and ProShares UltraShort
The main advantage of trading using opposite Barclays Capital and ProShares UltraShort positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barclays Capital 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.The idea behind Barclays Capital and ProShares UltraShort MSCI pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| ProShares UltraShort vs. ProShares UltraShort FTSE | ProShares UltraShort vs. ProShares UltraShort MSCI | ProShares UltraShort vs. ProShares Ultra MSCI | ProShares UltraShort vs. ProShares UltraShort MSCI |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |