Correlation Between ProShares UltraPro and Putnam Sustainable
Can any of the company-specific risk be diversified away by investing in both ProShares UltraPro and Putnam Sustainable 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 UltraPro and Putnam Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares UltraPro SP500 and Putnam Sustainable Leaders, you can compare the effects of market volatilities on ProShares UltraPro and Putnam Sustainable 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 UltraPro with a short position of Putnam Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares UltraPro and Putnam Sustainable.
Diversification Opportunities for ProShares UltraPro and Putnam Sustainable
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ProShares and Putnam is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding ProShares UltraPro SP500 and Putnam Sustainable Leaders in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Sustainable and ProShares UltraPro 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 UltraPro SP500 are associated (or correlated) with Putnam Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Sustainable has no effect on the direction of ProShares UltraPro i.e., ProShares UltraPro and Putnam Sustainable go up and down completely randomly.
Pair Corralation between ProShares UltraPro and Putnam Sustainable
Given the investment horizon of 90 days ProShares UltraPro SP500 is expected to generate 3.02 times more return on investment than Putnam Sustainable. However, ProShares UltraPro is 3.02 times more volatile than Putnam Sustainable Leaders. It trades about 0.14 of its potential returns per unit of risk. Putnam Sustainable Leaders is currently generating about 0.11 per unit of risk. If you would invest 8,871 in ProShares UltraPro SP500 on August 30, 2024 and sell it today you would earn a total of 668.00 from holding ProShares UltraPro SP500 or generate 7.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
ProShares UltraPro SP500 vs. Putnam Sustainable Leaders
Performance |
| Timeline |
| ProShares UltraPro SP500 |
| Putnam Sustainable |
ProShares UltraPro and Putnam Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares UltraPro and Putnam Sustainable
The main advantage of trading using opposite ProShares UltraPro and Putnam Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares UltraPro position performs unexpectedly, Putnam Sustainable 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 Putnam Sustainable will offset losses from the drop in Putnam Sustainable's long position.| ProShares UltraPro vs. ProShares UltraPro Dow30 | ProShares UltraPro vs. ProShares UltraPro Short | ProShares UltraPro vs. ProShares UltraPro QQQ | ProShares UltraPro vs. Direxion Daily Small |
| Putnam Sustainable vs. Putnam Sustainable Future | Putnam Sustainable vs. Putnam Focused Large | Putnam Sustainable vs. Putnam Focused Large | Putnam Sustainable vs. Overlay Shares Hedged |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Commodity Directory Find actively traded commodities issued by global exchanges |