Correlation Between BetaPro SPTSX and Evolve Banks

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

By analyzing existing cross correlation between BetaPro SPTSX 60 and Evolve Banks Enhanced, you can compare the effects of market volatilities on BetaPro SPTSX and Evolve Banks 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 SPTSX with a short position of Evolve Banks. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaPro SPTSX and Evolve Banks.

Diversification Opportunities for BetaPro SPTSX and Evolve Banks

-0.86

Correlation Coefficient

BetaPro SPTSX  Evolve Banks

Pay attention - limited upside

The 3 months correlation between BetaPro and Evolve is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro SPTSX 60 and Evolve Banks Enhanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolve Banks Enhanced and BetaPro SPTSX 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 SPTSX 60 are associated (or correlated) with Evolve Banks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolve Banks Enhanced has no effect on the direction of BetaPro SPTSX i.e., BetaPro SPTSX and Evolve Banks go up and down completely randomly.

Pair Corralation between BetaPro SPTSX and Evolve Banks

Assuming the 90 days trading horizon BetaPro SPTSX 60 is expected to under-perform the Evolve Banks. But the etf apears to be less risky and, when comparing its historical volatility, BetaPro SPTSX 60 is 1.45 times less risky than Evolve Banks. The etf trades about -0.34 of its potential returns per unit of risk. The Evolve Banks Enhanced is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest  1,131  in Evolve Banks Enhanced on April 25, 2025 and sell it today you would earn a total of  244.00  from holding Evolve Banks Enhanced or generate 21.57% return on investment over 90 days.

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

BetaPro SPTSX 60  vs.  Evolve Banks Enhanced

BetaPro SPTSX 60

Risk-Adjusted Performance

Very Weak

Over the last 90 days BetaPro SPTSX 60 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 August 2025. The recent disarray may also be a sign of long period up-swing for the ETF investors.

Evolve Banks Enhanced

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Evolve Banks Enhanced are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Evolve Banks displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BetaPro SPTSX and Evolve Banks

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

The idea behind BetaPro SPTSX 60 and Evolve Banks Enhanced 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.