Correlation Between ProShares Short and Gan Shmuel
Can any of the company-specific risk be diversified away by investing in both ProShares Short and Gan Shmuel 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 Short and Gan Shmuel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Short Russell2000 and Gan Shmuel, you can compare the effects of market volatilities on ProShares Short and Gan Shmuel 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 Short with a short position of Gan Shmuel. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Short and Gan Shmuel.
Diversification Opportunities for ProShares Short and Gan Shmuel
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and Gan is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Short Russell2000 and Gan Shmuel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Shmuel and ProShares Short 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 Short Russell2000 are associated (or correlated) with Gan Shmuel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Shmuel has no effect on the direction of ProShares Short i.e., ProShares Short and Gan Shmuel go up and down completely randomly.
Pair Corralation between ProShares Short and Gan Shmuel
Considering the 90-day investment horizon ProShares Short is expected to generate 195.17 times less return on investment than Gan Shmuel. But when comparing it to its historical volatility, ProShares Short Russell2000 is 3.11 times less risky than Gan Shmuel. It trades about 0.01 of its potential returns per unit of risk. Gan Shmuel is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 141,040 in Gan Shmuel on January 26, 2024 and sell it today you would earn a total of 110,560 from holding Gan Shmuel or generate 78.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 76.19% |
| Values | Daily Returns |
ProShares Short Russell2000 vs. Gan Shmuel
Performance |
| Timeline |
| ProShares Short Russ |
| Gan Shmuel |
ProShares Short and Gan Shmuel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Short and Gan Shmuel
The main advantage of trading using opposite ProShares Short and Gan Shmuel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Short position performs unexpectedly, Gan Shmuel 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 Gan Shmuel will offset losses from the drop in Gan Shmuel's long position.The idea behind ProShares Short Russell2000 and Gan Shmuel pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Gan Shmuel vs. Neto ME Holdings | Gan Shmuel vs. Kerur Holdings | Gan Shmuel vs. Salomon A Angel | Gan Shmuel vs. Sano Brunos Enterprises |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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