Correlation Between Pacer Cash and Exchange Traded

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

By analyzing existing cross correlation between Pacer Cash Cows and Exchange Traded Concepts, you can compare the effects of market volatilities on Pacer Cash and Exchange Traded 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 Pacer Cash with a short position of Exchange Traded. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacer Cash and Exchange Traded.

Diversification Opportunities for Pacer Cash and Exchange Traded

0.45

Correlation Coefficient

Pacer Cash  Exchange Traded

Very weak diversification

The 3 months correlation between Pacer and Exchange is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Pacer Cash Cows and Exchange Traded Concepts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exchange Traded Concepts and Pacer Cash 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 Pacer Cash Cows are associated (or correlated) with Exchange Traded. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exchange Traded Concepts has no effect on the direction of Pacer Cash i.e., Pacer Cash and Exchange Traded go up and down completely randomly.

Pair Corralation between Pacer Cash and Exchange Traded

Considering the 90-day investment horizon Pacer Cash Cows is expected to under-perform the Exchange Traded. In addition to that, Pacer Cash is 4.72 times more volatile than Exchange Traded Concepts. It trades about -0.01 of its total potential returns per unit of risk. Exchange Traded Concepts is currently generating about 0.12 per unit of volatility. If you would invest  2,499  in Exchange Traded Concepts on August 21, 2025 and sell it today you would earn a total of  40.90  from holding Exchange Traded Concepts or generate 1.64% return on investment over 90 days.

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

Pacer Cash Cows  vs.  Exchange Traded Concepts

Pacer Cash Cows

Risk-Adjusted Performance

Weakest

Over the last 90 days Pacer Cash Cows has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Pacer Cash is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Exchange Traded Concepts

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Exchange Traded Concepts are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Exchange Traded is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Pacer Cash and Exchange Traded

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

The idea behind Pacer Cash Cows and Exchange Traded Concepts 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.