Correlation Between Ultranasdaq 100 and Nasdaq-100(r)
Can any of the company-specific risk be diversified away by investing in both Ultranasdaq 100 and Nasdaq-100(r) 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 Ultranasdaq 100 and Nasdaq-100(r) into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultranasdaq 100 Profund Ultranasdaq 100 and Nasdaq 100 2x Strategy, you can compare the effects of market volatilities on Ultranasdaq 100 and Nasdaq-100(r) 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 Ultranasdaq 100 with a short position of Nasdaq-100(r). Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultranasdaq 100 and Nasdaq-100(r).
Diversification Opportunities for Ultranasdaq 100 and Nasdaq-100(r)
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Ultranasdaq and Nasdaq-100(r) is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Ultranasdaq 100 Profund Ultran and Nasdaq 100 2x Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 2x and Ultranasdaq 100 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 Ultranasdaq 100 Profund Ultranasdaq 100 are associated (or correlated) with Nasdaq-100(r). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 2x has no effect on the direction of Ultranasdaq 100 i.e., Ultranasdaq 100 and Nasdaq-100(r) go up and down completely randomly.
Pair Corralation between Ultranasdaq 100 and Nasdaq-100(r)
Assuming the 90 days horizon Ultranasdaq 100 is expected to generate 1.26 times less return on investment than Nasdaq-100(r). But when comparing it to its historical volatility, Ultranasdaq 100 Profund Ultranasdaq 100 is 1.01 times less risky than Nasdaq-100(r). It trades about 0.16 of its potential returns per unit of risk. Nasdaq 100 2x Strategy is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 38,486 in Nasdaq 100 2x Strategy on September 2, 2024 and sell it today you would earn a total of 3,248 from holding Nasdaq 100 2x Strategy or generate 8.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ultranasdaq 100 Profund Ultran vs. Nasdaq 100 2x Strategy
Performance |
| Timeline |
| Ultranasdaq 100 Profund |
| Nasdaq 100 2x |
Ultranasdaq 100 and Nasdaq-100(r) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultranasdaq 100 and Nasdaq-100(r)
The main advantage of trading using opposite Ultranasdaq 100 and Nasdaq-100(r) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultranasdaq 100 position performs unexpectedly, Nasdaq-100(r) 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 Nasdaq-100(r) will offset losses from the drop in Nasdaq-100(r)'s long position.| Ultranasdaq 100 vs. Short Real Estate | Ultranasdaq 100 vs. Short Real Estate | Ultranasdaq 100 vs. Ultrashort Mid Cap Profund | Ultranasdaq 100 vs. Ultrashort Mid Cap Profund |
| Nasdaq-100(r) vs. Volumetric Fund Volumetric | Nasdaq-100(r) vs. Rbb Fund | Nasdaq-100(r) vs. Ab Value Fund | Nasdaq-100(r) vs. Vanguard Small Cap Growth |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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