Correlation Between Abrdn Bloomberg and ProShares
Can any of the company-specific risk be diversified away by investing in both Abrdn Bloomberg and ProShares 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 Abrdn Bloomberg and ProShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between abrdn Bloomberg All and ProShares SP 500, you can compare the effects of market volatilities on Abrdn Bloomberg and ProShares 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 Abrdn Bloomberg with a short position of ProShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abrdn Bloomberg and ProShares.
Diversification Opportunities for Abrdn Bloomberg and ProShares
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Abrdn and ProShares is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding abrdn Bloomberg All and ProShares SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares SP 500 and Abrdn Bloomberg 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 abrdn Bloomberg All are associated (or correlated) with ProShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares SP 500 has no effect on the direction of Abrdn Bloomberg i.e., Abrdn Bloomberg and ProShares go up and down completely randomly.
Pair Corralation between Abrdn Bloomberg and ProShares
Considering the 90-day investment horizon abrdn Bloomberg All is expected to under-perform the ProShares. In addition to that, Abrdn Bloomberg is 1.01 times more volatile than ProShares SP 500. It trades about -0.02 of its total potential returns per unit of risk. ProShares SP 500 is currently generating about 0.02 per unit of volatility. If you would invest 9,086 in ProShares SP 500 on January 18, 2024 and sell it today you would earn a total of 514.00 from holding ProShares SP 500 or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
abrdn Bloomberg All vs. ProShares SP 500
Performance |
| Timeline |
| abrdn Bloomberg All |
| ProShares SP 500 |
Abrdn Bloomberg and ProShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abrdn Bloomberg and ProShares
The main advantage of trading using opposite Abrdn Bloomberg and ProShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abrdn Bloomberg position performs unexpectedly, ProShares 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 will offset losses from the drop in ProShares' long position.| Abrdn Bloomberg vs. Invesco DB Agriculture | Abrdn Bloomberg vs. Invesco DB Base | Abrdn Bloomberg vs. VanEck Agribusiness ETF |
| ProShares vs. Invesco International BuyBack | ProShares vs. Invesco Variable Rate | ProShares vs. First Trust Small | ProShares vs. First Trust Multi |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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