Correlation Between ProShares UltraShort and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both ProShares UltraShort and Goldman Sachs 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 UltraShort and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares UltraShort 20 and Goldman Sachs Access, you can compare the effects of market volatilities on ProShares UltraShort and Goldman Sachs 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 UltraShort with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares UltraShort and Goldman Sachs.
Diversification Opportunities for ProShares UltraShort and Goldman Sachs
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ProShares and Goldman is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding ProShares UltraShort 20 and Goldman Sachs Access in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Access and ProShares UltraShort 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 UltraShort 20 are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Access has no effect on the direction of ProShares UltraShort i.e., ProShares UltraShort and Goldman Sachs go up and down completely randomly.
Pair Corralation between ProShares UltraShort and Goldman Sachs
Considering the 90-day investment horizon ProShares UltraShort 20 is expected to under-perform the Goldman Sachs. In addition to that, ProShares UltraShort is 8.97 times more volatile than Goldman Sachs Access. It trades about -0.05 of its total potential returns per unit of risk. Goldman Sachs Access is currently generating about 0.0 per unit of volatility. If you would invest 4,904 in Goldman Sachs Access on August 31, 2024 and sell it today you would earn a total of 1.00 from holding Goldman Sachs Access or generate 0.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares UltraShort 20 vs. Goldman Sachs Access
Performance |
| Timeline |
| ProShares UltraShort |
| Goldman Sachs Access |
ProShares UltraShort and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares UltraShort and Goldman Sachs
The main advantage of trading using opposite ProShares UltraShort and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares UltraShort position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| ProShares UltraShort vs. ProShares UltraShort 7 10 | ProShares UltraShort vs. ProShares UltraShort SP500 | ProShares UltraShort vs. iShares 20 Year | ProShares UltraShort vs. Direxion Daily 20 |
| Goldman Sachs vs. SPDR Bloomberg 1 10 | Goldman Sachs vs. PIMCO Broad TIPS | Goldman Sachs vs. SPDR Portfolio TIPS | Goldman Sachs vs. FlexShares iBoxx 5 Year |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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