Correlation Between GraniteShares 15x and FT Cboe

Can any of the company-specific risk be diversified away by investing in both GraniteShares 15x and FT Cboe 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 GraniteShares 15x and FT Cboe into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GraniteShares 15x Long and FT Cboe Vest, you can compare the effects of market volatilities on GraniteShares 15x and FT Cboe 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 GraniteShares 15x with a short position of FT Cboe. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares 15x and FT Cboe.

Diversification Opportunities for GraniteShares 15x and FT Cboe

-0.09

Correlation Coefficient

GraniteShares 15x  FT Cboe

Good diversification

The 3 months correlation between GraniteShares and DAUG is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 15x Long and FT Cboe Vest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Cboe Vest and GraniteShares 15x 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 GraniteShares 15x Long are associated (or correlated) with FT Cboe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Cboe Vest has no effect on the direction of GraniteShares 15x i.e., GraniteShares 15x and FT Cboe go up and down completely randomly.

Pair Corralation between GraniteShares 15x and FT Cboe

Given the investment horizon of 90 days GraniteShares 15x Long is expected to generate 22.18 times more return on investment than FT Cboe. However, GraniteShares 15x is 22.18 times more volatile than FT Cboe Vest. It trades about 0.08 of its potential returns per unit of risk. FT Cboe Vest is currently generating about 0.14 per unit of risk. If you would invest  3,288  in GraniteShares 15x Long on October 22, 2024 and sell it today you would earn a total of  3,570  from holding GraniteShares 15x Long or generate 108.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

GraniteShares 15x Long  vs.  FT Cboe Vest

GraniteShares 15x Long

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GraniteShares 15x Long has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Etf's fundamental indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the ETF venture institutional investors.

FT Cboe Vest

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FT Cboe Vest are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, FT Cboe is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with GraniteShares 15x and FT Cboe

The main advantage of trading using opposite GraniteShares 15x and FT Cboe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares 15x position performs unexpectedly, FT Cboe 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 FT Cboe will offset losses from the drop in FT Cboe's long position.

The idea behind GraniteShares 15x Long and FT Cboe Vest 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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.