Correlation Between ProShares Ultra and Vanguard Core
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Vanguard Core 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 Vanguard Core 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 Vanguard Core Bond, you can compare the effects of market volatilities on ProShares Ultra and Vanguard Core 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 Vanguard Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Vanguard Core.
Diversification Opportunities for ProShares Ultra and Vanguard Core
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ProShares and Vanguard is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Oil and Vanguard Core Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Core Bond 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 Vanguard Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Core Bond has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Vanguard Core go up and down completely randomly.
Pair Corralation between ProShares Ultra and Vanguard Core
Considering the 90-day investment horizon ProShares Ultra Oil is expected to generate 7.27 times more return on investment than Vanguard Core. However, ProShares Ultra is 7.27 times more volatile than Vanguard Core Bond. It trades about 0.02 of its potential returns per unit of risk. Vanguard Core Bond is currently generating about 0.11 per unit of risk. If you would invest 4,353 in ProShares Ultra Oil on August 29, 2024 and sell it today you would earn a total of 77.00 from holding ProShares Ultra Oil or generate 1.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Ultra Oil vs. Vanguard Core Bond
Performance |
| Timeline |
| ProShares Ultra Oil |
| Vanguard Core Bond |
ProShares Ultra and Vanguard Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Vanguard Core
The main advantage of trading using opposite ProShares Ultra and Vanguard Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Vanguard Core 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 Vanguard Core will offset losses from the drop in Vanguard Core'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 |
| Vanguard Core vs. Valued Advisers Trust | Vanguard Core vs. Columbia Diversified Fixed | Vanguard Core vs. Principal Exchange Traded Funds | Vanguard Core vs. Doubleline Etf Trust |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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