Correlation Between ProShares Ultra and DBX ETF
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and DBX ETF 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 DBX ETF 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 DBX ETF Trust, you can compare the effects of market volatilities on ProShares Ultra and DBX ETF 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 DBX ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and DBX ETF.
Diversification Opportunities for ProShares Ultra and DBX ETF
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ProShares and DBX is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Euro and DBX ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBX ETF Trust 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 DBX ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBX ETF Trust has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and DBX ETF go up and down completely randomly.
Pair Corralation between ProShares Ultra and DBX ETF
Considering the 90-day investment horizon ProShares Ultra Euro is expected to under-perform the DBX ETF. But the etf apears to be less risky and, when comparing its historical volatility, ProShares Ultra Euro is 1.27 times less risky than DBX ETF. The etf trades about -0.04 of its potential returns per unit of risk. The DBX ETF Trust is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,532 in DBX ETF Trust on September 5, 2024 and sell it today you would earn a total of 247.00 from holding DBX ETF Trust or generate 9.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 84.0% |
| Values | Daily Returns |
ProShares Ultra Euro vs. DBX ETF Trust
Performance |
| Timeline |
| ProShares Ultra Euro |
| DBX ETF Trust |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
ProShares Ultra and DBX ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and DBX ETF
The main advantage of trading using opposite ProShares Ultra and DBX ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, DBX ETF 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 DBX ETF will offset losses from the drop in DBX ETF's long position.| ProShares Ultra vs. FT Cboe Vest | ProShares Ultra vs. Aquagold International | ProShares Ultra vs. Morningstar Unconstrained Allocation | ProShares Ultra vs. High Yield Municipal Fund |
| DBX ETF vs. Xtrackers MSCI EAFE | DBX ETF vs. SPDR MSCI Emerging | DBX ETF vs. NuShares ETF Trust | DBX ETF vs. Xtrackers MSCI USA |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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