Correlation Between SPDR Barclays and ProShares Short
Can any of the company-specific risk be diversified away by investing in both SPDR Barclays and ProShares Short 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 SPDR Barclays and ProShares Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Barclays Short and ProShares Short QQQ, you can compare the effects of market volatilities on SPDR Barclays and ProShares Short 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 SPDR Barclays with a short position of ProShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Barclays and ProShares Short.
Diversification Opportunities for SPDR Barclays and ProShares Short
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPDR and ProShares is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Barclays Short and ProShares Short QQQ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Short QQQ and SPDR Barclays 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 SPDR Barclays Short are associated (or correlated) with ProShares Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Short QQQ has no effect on the direction of SPDR Barclays i.e., SPDR Barclays and ProShares Short go up and down completely randomly.
Pair Corralation between SPDR Barclays and ProShares Short
Given the investment horizon of 90 days SPDR Barclays is expected to generate 1017.86 times less return on investment than ProShares Short. But when comparing it to its historical volatility, SPDR Barclays Short is 437.1 times less risky than ProShares Short. It trades about 0.04 of its potential returns per unit of risk. ProShares Short QQQ is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,545 in ProShares Short QQQ on January 26, 2024 and sell it today you would earn a total of 34.00 from holding ProShares Short QQQ or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.41% |
| Values | Daily Returns |
SPDR Barclays Short vs. ProShares Short QQQ
Performance |
| Timeline |
| SPDR Barclays Short |
| ProShares Short QQQ |
SPDR Barclays and ProShares Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Barclays and ProShares Short
The main advantage of trading using opposite SPDR Barclays and ProShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Barclays position performs unexpectedly, ProShares Short 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 Short will offset losses from the drop in ProShares Short's long position.| SPDR Barclays vs. SPDR Barclays Intermediate | SPDR Barclays vs. Western Asset Short | SPDR Barclays vs. SPDR Barclays Short | SPDR Barclays vs. iShares 1 5 Year |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |