Correlation Between Short Nasdaq-100 and Bear Profund
Can any of the company-specific risk be diversified away by investing in both Short Nasdaq-100 and Bear Profund 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 Short Nasdaq-100 and Bear Profund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Short Nasdaq 100 Profund and Bear Profund Bear, you can compare the effects of market volatilities on Short Nasdaq-100 and Bear Profund 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 Short Nasdaq-100 with a short position of Bear Profund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Short Nasdaq-100 and Bear Profund.
Diversification Opportunities for Short Nasdaq-100 and Bear Profund
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Short and Bear is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Short Nasdaq 100 Profund and Bear Profund Bear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bear Profund Bear and Short Nasdaq-100 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 Short Nasdaq 100 Profund are associated (or correlated) with Bear Profund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bear Profund Bear has no effect on the direction of Short Nasdaq-100 i.e., Short Nasdaq-100 and Bear Profund go up and down completely randomly.
Pair Corralation between Short Nasdaq-100 and Bear Profund
Assuming the 90 days horizon Short Nasdaq 100 Profund is expected to under-perform the Bear Profund. In addition to that, Short Nasdaq-100 is 1.37 times more volatile than Bear Profund Bear. It trades about -0.08 of its total potential returns per unit of risk. Bear Profund Bear is currently generating about -0.07 per unit of volatility. If you would invest 1,412 in Bear Profund Bear on November 7, 2024 and sell it today you would lose (351.00) from holding Bear Profund Bear or give up 24.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Short Nasdaq 100 Profund vs. Bear Profund Bear
Performance |
| Timeline |
| Short Nasdaq 100 |
| Bear Profund Bear |
Short Nasdaq-100 and Bear Profund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Short Nasdaq-100 and Bear Profund
The main advantage of trading using opposite Short Nasdaq-100 and Bear Profund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Short Nasdaq-100 position performs unexpectedly, Bear Profund 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 Bear Profund will offset losses from the drop in Bear Profund's long position.| Short Nasdaq-100 vs. Short Real Estate | Short Nasdaq-100 vs. Vanguard Reit Index | Short Nasdaq-100 vs. Vy Clarion Real | Short Nasdaq-100 vs. Nexpoint Real Estate |
| Bear Profund vs. Franklin Lifesmart Retirement | Bear Profund vs. American Funds Retirement | Bear Profund vs. Franklin Lifesmart Retirement | Bear Profund vs. Putnman Retirement Ready |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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