Correlation Between FT Vest and ProShares UltraPro
Can any of the company-specific risk be diversified away by investing in both FT Vest and ProShares UltraPro 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 FT Vest and ProShares UltraPro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FT Vest Equity and ProShares UltraPro Short, you can compare the effects of market volatilities on FT Vest and ProShares UltraPro 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 FT Vest with a short position of ProShares UltraPro. Check out your portfolio center. Please also check ongoing floating volatility patterns of FT Vest and ProShares UltraPro.
Diversification Opportunities for FT Vest and ProShares UltraPro
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between DHDG and ProShares is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding FT Vest Equity and ProShares UltraPro Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares UltraPro Short and FT Vest 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 FT Vest Equity are associated (or correlated) with ProShares UltraPro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares UltraPro Short has no effect on the direction of FT Vest i.e., FT Vest and ProShares UltraPro go up and down completely randomly.
Pair Corralation between FT Vest and ProShares UltraPro
Given the investment horizon of 90 days FT Vest Equity is expected to generate 0.1 times more return on investment than ProShares UltraPro. However, FT Vest Equity is 10.42 times less risky than ProShares UltraPro. It trades about 0.2 of its potential returns per unit of risk. ProShares UltraPro Short is currently generating about -0.05 per unit of risk. If you would invest 3,038 in FT Vest Equity on September 12, 2024 and sell it today you would earn a total of 84.00 from holding FT Vest Equity or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 14.92% |
| Values | Daily Returns |
FT Vest Equity vs. ProShares UltraPro Short
Performance |
| Timeline |
| FT Vest Equity |
| ProShares UltraPro Short |
FT Vest and ProShares UltraPro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FT Vest and ProShares UltraPro
The main advantage of trading using opposite FT Vest and ProShares UltraPro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FT Vest position performs unexpectedly, ProShares UltraPro 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 UltraPro will offset losses from the drop in ProShares UltraPro's long position.| FT Vest vs. Northern Lights | FT Vest vs. Dimensional International High | FT Vest vs. JPMorgan Fundamental Data | FT Vest vs. Matthews China Discovery |
| ProShares UltraPro vs. ProShares UltraShort MSCI | ProShares UltraPro vs. ProShares UltraShort MSCI | ProShares UltraPro vs. ProShares UltraShort Euro | ProShares UltraPro vs. ProShares UltraShort MSCI |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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