Correlation Between IQ Merger and ProShares Inflation
Can any of the company-specific risk be diversified away by investing in both IQ Merger and ProShares Inflation 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 IQ Merger and ProShares Inflation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IQ Merger Arbitrage and ProShares Inflation Expectations, you can compare the effects of market volatilities on IQ Merger and ProShares Inflation 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 IQ Merger with a short position of ProShares Inflation. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQ Merger and ProShares Inflation.
Diversification Opportunities for IQ Merger and ProShares Inflation
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MNA and ProShares is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding IQ Merger Arbitrage and ProShares Inflation Expectatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Inflation and IQ Merger 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 IQ Merger Arbitrage are associated (or correlated) with ProShares Inflation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Inflation has no effect on the direction of IQ Merger i.e., IQ Merger and ProShares Inflation go up and down completely randomly.
Pair Corralation between IQ Merger and ProShares Inflation
Considering the 90-day investment horizon IQ Merger Arbitrage is expected to generate 0.9 times more return on investment than ProShares Inflation. However, IQ Merger Arbitrage is 1.11 times less risky than ProShares Inflation. It trades about 0.17 of its potential returns per unit of risk. ProShares Inflation Expectations is currently generating about -0.03 per unit of risk. If you would invest 3,524 in IQ Merger Arbitrage on May 28, 2025 and sell it today you would earn a total of 47.50 from holding IQ Merger Arbitrage or generate 1.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IQ Merger Arbitrage vs. ProShares Inflation Expectatio
Performance |
| Timeline |
| IQ Merger Arbitrage |
| ProShares Inflation |
IQ Merger and ProShares Inflation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IQ Merger and ProShares Inflation
The main advantage of trading using opposite IQ Merger and ProShares Inflation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IQ Merger position performs unexpectedly, ProShares Inflation 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 Inflation will offset losses from the drop in ProShares Inflation's long position.| IQ Merger vs. AGFiQ Market Neutral | IQ Merger vs. ProShares Merger ETF | IQ Merger vs. IQ Hedge Multi Strategy |
| ProShares Inflation vs. First Trust TCW | ProShares Inflation vs. FolioBeyond Rising Rates | ProShares Inflation vs. Starboard Investment Trust | ProShares Inflation vs. SSGA Active Trust |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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