Correlation Between ProShares Ultra and Aptus Large
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Aptus Large 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 Aptus Large 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 Aptus Large Cap, you can compare the effects of market volatilities on ProShares Ultra and Aptus Large 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 Aptus Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Aptus Large.
Diversification Opportunities for ProShares Ultra and Aptus Large
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ProShares and Aptus is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Euro and Aptus Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptus Large Cap 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 Aptus Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptus Large Cap has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Aptus Large go up and down completely randomly.
Pair Corralation between ProShares Ultra and Aptus Large
Considering the 90-day investment horizon ProShares Ultra Euro is expected to under-perform the Aptus Large. In addition to that, ProShares Ultra is 1.13 times more volatile than Aptus Large Cap. It trades about -0.05 of its total potential returns per unit of risk. Aptus Large Cap is currently generating about 0.14 per unit of volatility. If you would invest 2,915 in Aptus Large Cap on September 1, 2024 and sell it today you would earn a total of 416.00 from holding Aptus Large Cap or generate 14.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
ProShares Ultra Euro vs. Aptus Large Cap
Performance |
| Timeline |
| ProShares Ultra Euro |
| Aptus Large Cap |
ProShares Ultra and Aptus Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Aptus Large
The main advantage of trading using opposite ProShares Ultra and Aptus Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Aptus Large 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 Aptus Large will offset losses from the drop in Aptus Large's long position.| ProShares Ultra vs. ProShares Ultra Yen | ProShares Ultra vs. ProShares UltraShort Yen | ProShares Ultra vs. ProShares UltraShort Euro | ProShares Ultra vs. ProShares Ultra Consumer |
| Aptus Large vs. Vanguard Total Stock | Aptus Large vs. SPDR SP 500 | Aptus Large vs. iShares Core SP | Aptus Large vs. Vanguard Dividend Appreciation |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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