Correlation Between Eaton Vance and Proshares

Can any of the company-specific risk be diversified away by investing in both Eaton Vance 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 Eaton Vance and Proshares into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Eaton Vance Enhanced and Proshares SP Global, you can compare the effects of market volatilities on Eaton Vance 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 Eaton Vance with a short position of Proshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Proshares.

Diversification Opportunities for Eaton Vance and Proshares

-0.86

Correlation Coefficient

Eaton Vance  Proshares

Pay attention - limited upside

The 3 months correlation between Eaton and Proshares is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Enhanced and Proshares SP Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proshares SP Global and Eaton Vance 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 Eaton Vance Enhanced 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 Global has no effect on the direction of Eaton Vance i.e., Eaton Vance and Proshares go up and down completely randomly.

Pair Corralation between Eaton Vance and Proshares

Considering the 90-day investment horizon Eaton Vance Enhanced is expected to generate 1.11 times more return on investment than Proshares. However, Eaton Vance is 1.11 times more volatile than Proshares SP Global. It trades about 0.03 of its potential returns per unit of risk. Proshares SP Global is currently generating about -0.46 per unit of risk. If you would invest  2,380  in Eaton Vance Enhanced on October 9, 2024 and sell it today you would earn a total of  13.00  from holding Eaton Vance Enhanced or generate 0.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	95.0%
Values	Daily Returns

Eaton Vance Enhanced  vs.  Proshares SP Global

Eaton Vance Enhanced

Risk-Adjusted Performance

15 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Enhanced are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Eaton Vance may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Proshares SP Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Proshares SP Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Etf's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the ETF investors.

Pair Trading with Eaton Vance and Proshares

The main advantage of trading using opposite Eaton Vance and Proshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance 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.

The idea behind Eaton Vance Enhanced and Proshares SP Global 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.

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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.