Correlation Between ProShares Trust and US Global
Can any of the company-specific risk be diversified away by investing in both ProShares Trust and US Global 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 Trust and US Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Trust and US Global Sea, you can compare the effects of market volatilities on ProShares Trust and US Global 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 Trust with a short position of US Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Trust and US Global.
Diversification Opportunities for ProShares Trust and US Global
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and SEA is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Trust and US Global Sea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Global Sea and ProShares Trust 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 Trust are associated (or correlated) with US Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Global Sea has no effect on the direction of ProShares Trust i.e., ProShares Trust and US Global go up and down completely randomly.
Pair Corralation between ProShares Trust and US Global
Given the investment horizon of 90 days ProShares Trust is expected to under-perform the US Global. In addition to that, ProShares Trust is 4.47 times more volatile than US Global Sea. It trades about -0.39 of its total potential returns per unit of risk. US Global Sea is currently generating about -0.21 per unit of volatility. If you would invest 1,637 in US Global Sea on September 2, 2024 and sell it today you would lose (68.00) from holding US Global Sea or give up 4.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Trust vs. US Global Sea
Performance |
| Timeline |
| ProShares Trust |
| US Global Sea |
ProShares Trust and US Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Trust and US Global
The main advantage of trading using opposite ProShares Trust and US Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Trust position performs unexpectedly, US Global 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 US Global will offset losses from the drop in US Global's long position.| ProShares Trust vs. AXS TSLA Bear | ProShares Trust vs. Tuttle Capital Short | ProShares Trust vs. ProShares Bitcoin Strategy | ProShares Trust vs. ProShares UltraShort Bloomberg |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |