Correlation Between ProShares Ultra and VanEck Junior
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and VanEck Junior 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 VanEck Junior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Ultra Gold and VanEck Junior Gold, you can compare the effects of market volatilities on ProShares Ultra and VanEck Junior 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 VanEck Junior. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and VanEck Junior.
Diversification Opportunities for ProShares Ultra and VanEck Junior
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ProShares and VanEck is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Gold and VanEck Junior Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Junior Gold 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 Gold are associated (or correlated) with VanEck Junior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Junior Gold has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and VanEck Junior go up and down completely randomly.
Pair Corralation between ProShares Ultra and VanEck Junior
Considering the 90-day investment horizon ProShares Ultra Gold is expected to generate 0.87 times more return on investment than VanEck Junior. However, ProShares Ultra Gold is 1.15 times less risky than VanEck Junior. It trades about 0.06 of its potential returns per unit of risk. VanEck Junior Gold is currently generating about 0.02 per unit of risk. If you would invest 8,871 in ProShares Ultra Gold on August 29, 2024 and sell it today you would earn a total of 574.00 from holding ProShares Ultra Gold or generate 6.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Ultra Gold vs. VanEck Junior Gold
Performance |
| Timeline |
| ProShares Ultra Gold |
| VanEck Junior Gold |
ProShares Ultra and VanEck Junior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and VanEck Junior
The main advantage of trading using opposite ProShares Ultra and VanEck Junior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, VanEck Junior 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 VanEck Junior will offset losses from the drop in VanEck Junior's long position.| ProShares Ultra vs. ProShares UltraShort Gold | ProShares Ultra vs. ProShares Ultra Silver | ProShares Ultra vs. ProShares UltraShort Silver | ProShares Ultra vs. DB Gold Double |
| VanEck Junior vs. VanEck Gold Miners | VanEck Junior vs. Global X Silver | VanEck Junior vs. Amplify ETF Trust | VanEck Junior vs. Pan American Silver |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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