Correlation Between ProShares UltraPro and GraniteShares HIPS
Can any of the company-specific risk be diversified away by investing in both ProShares UltraPro and GraniteShares HIPS 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 UltraPro and GraniteShares HIPS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares UltraPro QQQ and GraniteShares HIPS High, you can compare the effects of market volatilities on ProShares UltraPro and GraniteShares HIPS 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 UltraPro with a short position of GraniteShares HIPS. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares UltraPro and GraniteShares HIPS.
Diversification Opportunities for ProShares UltraPro and GraniteShares HIPS
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and GraniteShares is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding ProShares UltraPro QQQ and GraniteShares HIPS High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GraniteShares HIPS High and ProShares UltraPro 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 UltraPro QQQ are associated (or correlated) with GraniteShares HIPS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GraniteShares HIPS High has no effect on the direction of ProShares UltraPro i.e., ProShares UltraPro and GraniteShares HIPS go up and down completely randomly.
Pair Corralation between ProShares UltraPro and GraniteShares HIPS
Given the investment horizon of 90 days ProShares UltraPro QQQ is expected to generate 4.99 times more return on investment than GraniteShares HIPS. However, ProShares UltraPro is 4.99 times more volatile than GraniteShares HIPS High. It trades about 0.1 of its potential returns per unit of risk. GraniteShares HIPS High is currently generating about 0.12 per unit of risk. If you would invest 2,761 in ProShares UltraPro QQQ on August 27, 2024 and sell it today you would earn a total of 5,064 from holding ProShares UltraPro QQQ or generate 183.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares UltraPro QQQ vs. GraniteShares HIPS High
Performance |
| Timeline |
| ProShares UltraPro QQQ |
| GraniteShares HIPS High |
ProShares UltraPro and GraniteShares HIPS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares UltraPro and GraniteShares HIPS
The main advantage of trading using opposite ProShares UltraPro and GraniteShares HIPS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares UltraPro position performs unexpectedly, GraniteShares HIPS 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 GraniteShares HIPS will offset losses from the drop in GraniteShares HIPS's long position.| ProShares UltraPro vs. Direxion Daily SP | ProShares UltraPro vs. Direxion Daily Semiconductor | ProShares UltraPro vs. Direxion Daily Semiconductor |
| GraniteShares HIPS vs. Amplify BlackSwan Growth | GraniteShares HIPS vs. RPAR Risk Parity | GraniteShares HIPS vs. WisdomTree International Efficient | GraniteShares HIPS vs. iMGP DBi Managed |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |