Correlation Between ProShares Ultra and Invesco Next
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Invesco Next 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 Ultra and Invesco Next into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Ultra Oil and Invesco Next Gen, you can compare the effects of market volatilities on ProShares Ultra and Invesco Next 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 Ultra with a short position of Invesco Next. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Invesco Next.
Diversification Opportunities for ProShares Ultra and Invesco Next
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and Invesco is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Oil and Invesco Next Gen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Next Gen and ProShares Ultra 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 Ultra Oil are associated (or correlated) with Invesco Next. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Next Gen has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Invesco Next go up and down completely randomly.
Pair Corralation between ProShares Ultra and Invesco Next
Considering the 90-day investment horizon ProShares Ultra Oil is expected to generate 2.94 times more return on investment than Invesco Next. However, ProShares Ultra is 2.94 times more volatile than Invesco Next Gen. It trades about 0.3 of its potential returns per unit of risk. Invesco Next Gen is currently generating about 0.2 per unit of risk. If you would invest 3,890 in ProShares Ultra Oil on September 1, 2024 and sell it today you would earn a total of 580.00 from holding ProShares Ultra Oil or generate 14.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
ProShares Ultra Oil vs. Invesco Next Gen
Performance |
| Timeline |
| ProShares Ultra Oil |
| Invesco Next Gen |
ProShares Ultra and Invesco Next Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Invesco Next
The main advantage of trading using opposite ProShares Ultra and Invesco Next positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Invesco Next 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 Invesco Next will offset losses from the drop in Invesco Next's long position.| ProShares Ultra vs. ProShares UltraShort Oil | ProShares Ultra vs. ProShares Ultra Basic | ProShares Ultra vs. ProShares Ultra Financials | ProShares Ultra vs. ProShares Ultra Real |
| Invesco Next vs. Freedom Day Dividend | Invesco Next vs. iShares MSCI China | Invesco Next vs. iShares Dividend and | Invesco Next vs. SmartETFs Dividend Builder |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |