Correlation Between Rivernorth Opportunities and ProShares MSCI

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

By analyzing existing cross correlation between Rivernorth Opportunities and ProShares MSCI Transformational, you can compare the effects of market volatilities on Rivernorth Opportunities and ProShares MSCI 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 Rivernorth Opportunities with a short position of ProShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rivernorth Opportunities and ProShares MSCI.

Diversification Opportunities for Rivernorth Opportunities and ProShares MSCI

0.97

Correlation Coefficient

Rivernorth Opportunities  ProShares MSCI

Almost no diversification

The 3 months correlation between Rivernorth and ProShares is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Rivernorth Opportunities and ProShares MSCI Transformationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares MSCI Trans and Rivernorth Opportunities 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 Rivernorth Opportunities are associated (or correlated) with ProShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares MSCI Trans has no effect on the direction of Rivernorth Opportunities i.e., Rivernorth Opportunities and ProShares MSCI go up and down completely randomly.

Pair Corralation between Rivernorth Opportunities and ProShares MSCI

Considering the 90-day investment horizon Rivernorth Opportunities is expected to generate 0.93 times more return on investment than ProShares MSCI. However, Rivernorth Opportunities is 1.07 times less risky than ProShares MSCI. It trades about 0.21 of its potential returns per unit of risk. ProShares MSCI Transformational is currently generating about 0.15 per unit of risk. If you would invest  1,130  in Rivernorth Opportunities on May 6, 2025 and sell it today you would earn a total of  102.00  from holding Rivernorth Opportunities or generate 9.03% return on investment over 90 days.

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

Rivernorth Opportunities  vs.  ProShares MSCI Transformationa

Rivernorth Opportunities

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Rivernorth Opportunities are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Rivernorth Opportunities may actually be approaching a critical reversion point that can send shares even higher in September 2025.

ProShares MSCI Trans

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ProShares MSCI Transformational are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, ProShares MSCI may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Rivernorth Opportunities and ProShares MSCI

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

The idea behind Rivernorth Opportunities and ProShares MSCI Transformational 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.