Correlation Between ProShares and Global X
Can any of the company-specific risk be diversified away by investing in both ProShares and Global X 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 and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares K 1 Free and Global X Artificial, you can compare the effects of market volatilities on ProShares and Global X 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 with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares and Global X.
Diversification Opportunities for ProShares and Global X
Poor diversification
The 3 months correlation between ProShares and Global is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding ProShares K 1 Free and Global X Artificial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Artificial and ProShares 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 K 1 Free are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Artificial has no effect on the direction of ProShares i.e., ProShares and Global X go up and down completely randomly.
Pair Corralation between ProShares and Global X
Given the investment horizon of 90 days ProShares K 1 Free is expected to generate 0.77 times more return on investment than Global X. However, ProShares K 1 Free is 1.3 times less risky than Global X. It trades about 0.05 of its potential returns per unit of risk. Global X Artificial is currently generating about -0.3 per unit of risk. If you would invest 4,746 in ProShares K 1 Free on January 24, 2024 and sell it today you would earn a total of 39.00 from holding ProShares K 1 Free or generate 0.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares K 1 Free vs. Global X Artificial
Performance |
| Timeline |
| ProShares K 1 |
| Global X Artificial |
ProShares and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares and Global X
The main advantage of trading using opposite ProShares and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| ProShares vs. United States 12 | ProShares vs. Credit Suisse X Links | ProShares vs. Invesco DB Oil | ProShares vs. United States 12 |
| Global X vs. First Trust Nasdaq | Global X vs. iShares Robotics and | Global X vs. Global X Robotics | Global X vs. Global X FinTech |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |