Correlation Between ProShares Ultra and Amplify
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Amplify 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 Amplify 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 Amplify, you can compare the effects of market volatilities on ProShares Ultra and Amplify 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 Amplify. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Amplify.
Diversification Opportunities for ProShares Ultra and Amplify
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ProShares and Amplify is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Euro and Amplify in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify 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 Amplify. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Amplify go up and down completely randomly.
Pair Corralation between ProShares Ultra and Amplify
Considering the 90-day investment horizon ProShares Ultra Euro is expected to generate 0.11 times more return on investment than Amplify. However, ProShares Ultra Euro is 8.96 times less risky than Amplify. It trades about -0.02 of its potential returns per unit of risk. Amplify is currently generating about -0.07 per unit of risk. If you would invest 1,128 in ProShares Ultra Euro on September 4, 2024 and sell it today you would lose (53.00) from holding ProShares Ultra Euro or give up 4.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 75.3% |
| Values | Daily Returns |
ProShares Ultra Euro vs. Amplify
Performance |
| Timeline |
| ProShares Ultra Euro |
| Amplify |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ProShares Ultra and Amplify Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Amplify
The main advantage of trading using opposite ProShares Ultra and Amplify positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Amplify 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 Amplify will offset losses from the drop in Amplify'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 |
| Amplify vs. Amplify Thematic All Stars | Amplify vs. Amplify ETF Trust | Amplify vs. Amplify BlackSwan ISWN | Amplify vs. Amplify International Enhanced |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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