Correlation Between BetaPro Natural and BetaPro Silver

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

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

Diversification Opportunities for BetaPro Natural and BetaPro Silver

-0.56

Correlation Coefficient

BetaPro Natural  BetaPro Silver

Excellent diversification

The 3 months correlation between BetaPro and BetaPro is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro Natural Gas and BetaPro Silver 2x in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BetaPro Silver 2x and BetaPro Natural 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 Natural Gas are associated (or correlated) with BetaPro Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BetaPro Silver 2x has no effect on the direction of BetaPro Natural i.e., BetaPro Natural and BetaPro Silver go up and down completely randomly.

Pair Corralation between BetaPro Natural and BetaPro Silver

Assuming the 90 days trading horizon BetaPro Natural Gas is expected to under-perform the BetaPro Silver. In addition to that, BetaPro Natural is 1.97 times more volatile than BetaPro Silver 2x. It trades about -0.02 of its total potential returns per unit of risk. BetaPro Silver 2x is currently generating about 0.12 per unit of volatility. If you would invest  2,995  in BetaPro Silver 2x on April 23, 2025 and sell it today you would earn a total of  713.00  from holding BetaPro Silver 2x or generate 23.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

BetaPro Natural Gas  vs.  BetaPro Silver 2x

BetaPro Natural Gas

Risk-Adjusted Performance

Very Weak

Over the last 90 days BetaPro Natural Gas has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Etf's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

BetaPro Silver 2x

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BetaPro Silver 2x are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, BetaPro Silver displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BetaPro Natural and BetaPro Silver

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

The idea behind BetaPro Natural Gas and BetaPro Silver 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.