Correlation Between Vanguard Value and ProShares Equities
Can any of the company-specific risk be diversified away by investing in both Vanguard Value and ProShares Equities 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 Vanguard Value and ProShares Equities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Value Index and ProShares Equities for, you can compare the effects of market volatilities on Vanguard Value and ProShares Equities 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 Vanguard Value with a short position of ProShares Equities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Value and ProShares Equities.
Diversification Opportunities for Vanguard Value and ProShares Equities
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Vanguard and ProShares is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Value Index and ProShares Equities for in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Equities for and Vanguard Value 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 Vanguard Value Index are associated (or correlated) with ProShares Equities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Equities for has no effect on the direction of Vanguard Value i.e., Vanguard Value and ProShares Equities go up and down completely randomly.
Pair Corralation between Vanguard Value and ProShares Equities
Considering the 90-day investment horizon Vanguard Value is expected to generate 1.94 times less return on investment than ProShares Equities. But when comparing it to its historical volatility, Vanguard Value Index is 1.49 times less risky than ProShares Equities. It trades about 0.21 of its potential returns per unit of risk. ProShares Equities for is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 5,825 in ProShares Equities for on August 26, 2024 and sell it today you would earn a total of 426.00 from holding ProShares Equities for or generate 7.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Value Index vs. ProShares Equities for
Performance |
| Timeline |
| Vanguard Value Index |
| ProShares Equities for |
Vanguard Value and ProShares Equities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Value and ProShares Equities
The main advantage of trading using opposite Vanguard Value and ProShares Equities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Value position performs unexpectedly, ProShares Equities 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 Equities will offset losses from the drop in ProShares Equities' long position.| Vanguard Value vs. Vanguard Growth Index | Vanguard Value vs. Vanguard Small Cap Value | Vanguard Value vs. Vanguard Mid Cap Value | Vanguard Value vs. Vanguard Small Cap Index |
| ProShares Equities vs. First Trust Developed | ProShares Equities vs. First Trust Indxx | ProShares Equities vs. Principal Quality ETF | ProShares Equities vs. VictoryShares Discovery 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |