Correlation Between Evolve Cryptocurrencies and BetaPro SP

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

By analyzing existing cross correlation between Evolve Cryptocurrencies ETF and BetaPro SP 500, you can compare the effects of market volatilities on Evolve Cryptocurrencies and BetaPro SP 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 Evolve Cryptocurrencies with a short position of BetaPro SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolve Cryptocurrencies and BetaPro SP.

Diversification Opportunities for Evolve Cryptocurrencies and BetaPro SP

-0.73

Correlation Coefficient

Evolve Cryptocurrencies  BetaPro SP

Pay attention - limited upside

The 3 months correlation between Evolve and BetaPro is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Evolve Cryptocurrencies ETF and BetaPro SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BetaPro SP 500 and Evolve Cryptocurrencies 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 Evolve Cryptocurrencies ETF are associated (or correlated) with BetaPro SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BetaPro SP 500 has no effect on the direction of Evolve Cryptocurrencies i.e., Evolve Cryptocurrencies and BetaPro SP go up and down completely randomly.

Pair Corralation between Evolve Cryptocurrencies and BetaPro SP

Assuming the 90 days trading horizon Evolve Cryptocurrencies ETF is expected to under-perform the BetaPro SP. In addition to that, Evolve Cryptocurrencies is 1.53 times more volatile than BetaPro SP 500. It trades about -0.08 of its total potential returns per unit of risk. BetaPro SP 500 is currently generating about 0.07 per unit of volatility. If you would invest  1,556  in BetaPro SP 500 on December 30, 2024 and sell it today you would earn a total of  122.00  from holding BetaPro SP 500 or generate 7.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Evolve Cryptocurrencies ETF  vs.  BetaPro SP 500

Evolve Cryptocurrencies

Risk-Adjusted Performance

Very Weak

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

BetaPro SP 500

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BetaPro SP 500 are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, BetaPro SP may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Evolve Cryptocurrencies and BetaPro SP

The main advantage of trading using opposite Evolve Cryptocurrencies and BetaPro SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolve Cryptocurrencies position performs unexpectedly, BetaPro SP 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 BetaPro SP will offset losses from the drop in BetaPro SP's long position.

The idea behind Evolve Cryptocurrencies ETF and BetaPro SP 500 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.