Correlation Between Innovator ETFs and ProShares Ultra
Can any of the company-specific risk be diversified away by investing in both Innovator ETFs and ProShares Ultra 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 Innovator ETFs and ProShares Ultra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator ETFs Trust and ProShares Ultra MSCI, you can compare the effects of market volatilities on Innovator ETFs and ProShares Ultra 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 Innovator ETFs with a short position of ProShares Ultra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator ETFs and ProShares Ultra.
Diversification Opportunities for Innovator ETFs and ProShares Ultra
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Innovator and ProShares is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Innovator ETFs Trust and ProShares Ultra MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Ultra MSCI and Innovator ETFs 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 Innovator ETFs Trust are associated (or correlated) with ProShares Ultra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Ultra MSCI has no effect on the direction of Innovator ETFs i.e., Innovator ETFs and ProShares Ultra go up and down completely randomly.
Pair Corralation between Innovator ETFs and ProShares Ultra
Given the investment horizon of 90 days Innovator ETFs Trust is expected to generate 0.38 times more return on investment than ProShares Ultra. However, Innovator ETFs Trust is 2.6 times less risky than ProShares Ultra. It trades about -0.01 of its potential returns per unit of risk. ProShares Ultra MSCI is currently generating about -0.02 per unit of risk. If you would invest 2,728 in Innovator ETFs Trust on September 2, 2024 and sell it today you would lose (23.00) from holding Innovator ETFs Trust or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovator ETFs Trust vs. ProShares Ultra MSCI
Performance |
| Timeline |
| Innovator ETFs Trust |
| ProShares Ultra MSCI |
Innovator ETFs and ProShares Ultra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator ETFs and ProShares Ultra
The main advantage of trading using opposite Innovator ETFs and ProShares Ultra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator ETFs position performs unexpectedly, ProShares Ultra 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 Ultra will offset losses from the drop in ProShares Ultra's long position.| Innovator ETFs vs. Innovator ETFs Trust | Innovator ETFs vs. First Trust Cboe | Innovator ETFs vs. Innovator SP 500 | Innovator ETFs vs. Innovator Equity Power |
| ProShares Ultra vs. ProShares Ultra MSCI | ProShares Ultra vs. ProShares Ultra MSCI | ProShares Ultra vs. ProShares Ultra FTSE | ProShares Ultra vs. ProShares Ultra Telecommunications |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |