Correlation Between ProShares Ultra and Exchange Listed
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Exchange Listed 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 Exchange Listed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Ultra Euro and Exchange Listed Funds, you can compare the effects of market volatilities on ProShares Ultra and Exchange Listed 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 Exchange Listed. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Exchange Listed.
Diversification Opportunities for ProShares Ultra and Exchange Listed
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ProShares and Exchange is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Euro and Exchange Listed Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exchange Listed Funds 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 Euro are associated (or correlated) with Exchange Listed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exchange Listed Funds has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Exchange Listed go up and down completely randomly.
Pair Corralation between ProShares Ultra and Exchange Listed
Considering the 90-day investment horizon ProShares Ultra Euro is expected to under-perform the Exchange Listed. But the etf apears to be less risky and, when comparing its historical volatility, ProShares Ultra Euro is 1.06 times less risky than Exchange Listed. The etf trades about -0.01 of its potential returns per unit of risk. The Exchange Listed Funds is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,498 in Exchange Listed Funds on August 26, 2024 and sell it today you would earn a total of 730.00 from holding Exchange Listed Funds or generate 29.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 49.06% |
| Values | Daily Returns |
ProShares Ultra Euro vs. Exchange Listed Funds
Performance |
| Timeline |
| ProShares Ultra Euro |
| Exchange Listed Funds |
ProShares Ultra and Exchange Listed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Exchange Listed
The main advantage of trading using opposite ProShares Ultra and Exchange Listed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Exchange Listed 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 Exchange Listed will offset losses from the drop in Exchange Listed's long position.| ProShares Ultra vs. ProShares VIX Short Term | ProShares Ultra vs. ProShares UltraShort Yen | ProShares Ultra vs. iPath Series B |
| Exchange Listed vs. FT Vest Equity | Exchange Listed vs. Northern Lights | Exchange Listed vs. Dimensional International High | Exchange Listed vs. First Trust Exchange Traded |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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