Correlation Between ProShares Ultra and Barclays Capital
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Barclays Capital 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 Barclays Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Ultra Bloomberg and Barclays Capital, you can compare the effects of market volatilities on ProShares Ultra and Barclays Capital 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 Barclays Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Barclays Capital.
Diversification Opportunities for ProShares Ultra and Barclays Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ProShares and Barclays is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Bloomberg and Barclays Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays Capital 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 Bloomberg are associated (or correlated) with Barclays Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays Capital has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Barclays Capital go up and down completely randomly.
Pair Corralation between ProShares Ultra and Barclays Capital
Considering the 90-day investment horizon ProShares Ultra Bloomberg is expected to generate 1.73 times more return on investment than Barclays Capital. However, ProShares Ultra is 1.73 times more volatile than Barclays Capital. It trades about 0.01 of its potential returns per unit of risk. Barclays Capital is currently generating about -0.02 per unit of risk. If you would invest 2,945 in ProShares Ultra Bloomberg on November 2, 2024 and sell it today you would lose (144.00) from holding ProShares Ultra Bloomberg or give up 4.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 21.86% |
| Values | Daily Returns |
ProShares Ultra Bloomberg vs. Barclays Capital
Performance |
| Timeline |
| ProShares Ultra Bloomberg |
| Barclays Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ProShares Ultra and Barclays Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Barclays Capital
The main advantage of trading using opposite ProShares Ultra and Barclays Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Barclays Capital 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 Barclays Capital will offset losses from the drop in Barclays Capital's long position.| ProShares Ultra vs. ProShares UltraShort Bloomberg | ProShares Ultra vs. United States Oil | ProShares Ultra vs. Direxion Daily Energy | ProShares Ultra vs. Direxion Daily SP |
| Barclays Capital vs. United States Oil | Barclays Capital vs. Invesco DB Oil | Barclays Capital vs. ProShares Ultra Bloomberg | Barclays Capital vs. United States Natural |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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