Correlation Between ProShares Ultra and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Goldman Sachs 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 Goldman Sachs 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 Goldman Sachs ETF, you can compare the effects of market volatilities on ProShares Ultra and Goldman Sachs 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 Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Goldman Sachs.
Diversification Opportunities for ProShares Ultra and Goldman Sachs
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and Goldman is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Euro and Goldman Sachs ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs ETF 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 Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs ETF has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Goldman Sachs go up and down completely randomly.
Pair Corralation between ProShares Ultra and Goldman Sachs
Considering the 90-day investment horizon ProShares Ultra Euro is expected to under-perform the Goldman Sachs. In addition to that, ProShares Ultra is 3.41 times more volatile than Goldman Sachs ETF. It trades about -0.19 of its total potential returns per unit of risk. Goldman Sachs ETF is currently generating about 0.13 per unit of volatility. If you would invest 4,084 in Goldman Sachs ETF on September 1, 2024 and sell it today you would earn a total of 49.00 from holding Goldman Sachs ETF or generate 1.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
ProShares Ultra Euro vs. Goldman Sachs ETF
Performance |
| Timeline |
| ProShares Ultra Euro |
| Goldman Sachs ETF |
ProShares Ultra and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Goldman Sachs
The main advantage of trading using opposite ProShares Ultra and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' 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 |
| Goldman Sachs vs. iShares JP Morgan | Goldman Sachs vs. SPDR Bloomberg Barclays | Goldman Sachs vs. SPDR DoubleLine Emerging | Goldman Sachs vs. JPMorgan USD Emerging |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |