Correlation Between BetaPro Marijuana and BetaPro NASDAQ

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

By analyzing existing cross correlation between BetaPro Marijuana Companies and BetaPro NASDAQ 100 2x, you can compare the effects of market volatilities on BetaPro Marijuana and BetaPro NASDAQ 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 BetaPro Marijuana with a short position of BetaPro NASDAQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaPro Marijuana and BetaPro NASDAQ.

Diversification Opportunities for BetaPro Marijuana and BetaPro NASDAQ

0.0

Correlation Coefficient

BetaPro Marijuana  BetaPro NASDAQ

Pay attention - limited upside

The 3 months correlation between BetaPro and BetaPro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro Marijuana Companies and BetaPro NASDAQ 100 2x in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BetaPro NASDAQ 100 and BetaPro Marijuana 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 BetaPro Marijuana Companies are associated (or correlated) with BetaPro NASDAQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BetaPro NASDAQ 100 has no effect on the direction of BetaPro Marijuana i.e., BetaPro Marijuana and BetaPro NASDAQ go up and down completely randomly.

Pair Corralation between BetaPro Marijuana and BetaPro NASDAQ

If you would invest (100.00) in BetaPro Marijuana Companies on September 3, 2024 and sell it today you would earn a total of  100.00  from holding BetaPro Marijuana Companies or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

BetaPro Marijuana Companies  vs.  BetaPro NASDAQ 100 2x

BetaPro Marijuana

Risk-Adjusted Performance

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Very Weak

Over the last 90 days BetaPro Marijuana Companies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking indicators, BetaPro Marijuana is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

BetaPro NASDAQ 100

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BetaPro NASDAQ 100 2x has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Etf's fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the ETF investors.

Pair Trading with BetaPro Marijuana and BetaPro NASDAQ

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

The idea behind BetaPro Marijuana Companies and BetaPro NASDAQ 100 2x 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.