Correlation Between ProShares UltraPro and QQC
Can any of the company-specific risk be diversified away by investing in both ProShares UltraPro and QQC 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 QQC 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 QQC, you can compare the effects of market volatilities on ProShares UltraPro and QQC 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 QQC. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares UltraPro and QQC.
Diversification Opportunities for ProShares UltraPro and QQC
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and QQC is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding ProShares UltraPro SP500 and QQC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QQC 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 QQC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QQC has no effect on the direction of ProShares UltraPro i.e., ProShares UltraPro and QQC go up and down completely randomly.
Pair Corralation between ProShares UltraPro and QQC
If you would invest 6,996 in ProShares UltraPro SP500 on September 1, 2024 and sell it today you would earn a total of 2,709 from holding ProShares UltraPro SP500 or generate 38.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.79% |
| Values | Daily Returns |
ProShares UltraPro SP500 vs. QQC
Performance |
| Timeline |
| ProShares UltraPro SP500 |
| QQC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ProShares UltraPro and QQC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares UltraPro and QQC
The main advantage of trading using opposite ProShares UltraPro and QQC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares UltraPro position performs unexpectedly, QQC 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 QQC will offset losses from the drop in QQC'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 |
| QQC vs. Vanguard Growth Index | QQC vs. iShares Russell 1000 | QQC vs. iShares SP 500 | QQC vs. iShares Core SP |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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