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 Semiconductors and Goldman Sachs Future, 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
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ProShares and Goldman is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Semiconductors and Goldman Sachs Future in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Future 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 Semiconductors 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 Future 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 is expected to generate 1.13 times less return on investment than Goldman Sachs. In addition to that, ProShares Ultra is 3.49 times more volatile than Goldman Sachs Future. It trades about 0.06 of its total potential returns per unit of risk. Goldman Sachs Future is currently generating about 0.24 per unit of volatility. If you would invest 3,007 in Goldman Sachs Future on August 26, 2024 and sell it today you would earn a total of 367.00 from holding Goldman Sachs Future or generate 12.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Ultra Semiconductors vs. Goldman Sachs Future
Performance |
| Timeline |
| ProShares Ultra Semi |
| Goldman Sachs Future |
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 Technology | ProShares Ultra vs. ProShares Ultra Industrials | ProShares Ultra vs. ProShares Ultra Basic | ProShares Ultra vs. ProShares Ultra Health |
| Goldman Sachs vs. Invesco NASDAQ Next | Goldman Sachs vs. Global X Cybersecurity | Goldman Sachs vs. Global X Infrastructure | Goldman Sachs vs. WisdomTree Cloud Computing |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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