Correlation Between ProShares Short and MicroSectors FANG
Can any of the company-specific risk be diversified away by investing in both ProShares Short and MicroSectors FANG 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 ProShares Short and MicroSectors FANG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Short QQQ and MicroSectors FANG Index, you can compare the effects of market volatilities on ProShares Short and MicroSectors FANG 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 ProShares Short with a short position of MicroSectors FANG. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Short and MicroSectors FANG.
Diversification Opportunities for ProShares Short and MicroSectors FANG
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ProShares and MicroSectors is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Short QQQ and MicroSectors FANG Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MicroSectors FANG Index and ProShares Short 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 ProShares Short QQQ are associated (or correlated) with MicroSectors FANG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MicroSectors FANG Index has no effect on the direction of ProShares Short i.e., ProShares Short and MicroSectors FANG go up and down completely randomly.
Pair Corralation between ProShares Short and MicroSectors FANG
Considering the 90-day investment horizon ProShares Short QQQ is expected to under-perform the MicroSectors FANG. But the etf apears to be less risky and, when comparing its historical volatility, ProShares Short QQQ is 3.17 times less risky than MicroSectors FANG. The etf trades about 0.0 of its potential returns per unit of risk. The MicroSectors FANG Index is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 459.00 in MicroSectors FANG Index on September 5, 2025 and sell it today you would earn a total of 4.00 from holding MicroSectors FANG Index or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Short QQQ vs. MicroSectors FANG Index
Performance |
| Timeline |
| ProShares Short QQQ |
| MicroSectors FANG Index |
ProShares Short and MicroSectors FANG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Short and MicroSectors FANG
The main advantage of trading using opposite ProShares Short and MicroSectors FANG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Short position performs unexpectedly, MicroSectors FANG 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 MicroSectors FANG will offset losses from the drop in MicroSectors FANG's long position.| ProShares Short vs. FT Vest Equity | ProShares Short vs. Northern Lights | ProShares Short vs. Diamond Hill Funds | ProShares Short vs. Dimensional International High |
| MicroSectors FANG vs. Strategy Shares | MicroSectors FANG vs. Freedom Day Dividend | MicroSectors FANG vs. Franklin Templeton ETF | MicroSectors FANG vs. iShares MSCI China |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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