Correlation Between ProShares Ultra and Tidal ETF
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Tidal ETF 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 Tidal ETF 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 Tidal ETF Trust, you can compare the effects of market volatilities on ProShares Ultra and Tidal ETF 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 Tidal ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Tidal ETF.
Diversification Opportunities for ProShares Ultra and Tidal ETF
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ProShares and Tidal is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Semiconductors and Tidal ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tidal ETF Trust 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 Tidal ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tidal ETF Trust has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Tidal ETF go up and down completely randomly.
Pair Corralation between ProShares Ultra and Tidal ETF
Considering the 90-day investment horizon ProShares Ultra Semiconductors is expected to generate 9.15 times more return on investment than Tidal ETF. However, ProShares Ultra is 9.15 times more volatile than Tidal ETF Trust. It trades about 0.11 of its potential returns per unit of risk. Tidal ETF Trust is currently generating about 0.05 per unit of risk. If you would invest 919.00 in ProShares Ultra Semiconductors on August 31, 2024 and sell it today you would earn a total of 5,158 from holding ProShares Ultra Semiconductors or generate 561.26% 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. Tidal ETF Trust
Performance |
| Timeline |
| ProShares Ultra Semi |
| Tidal ETF Trust |
ProShares Ultra and Tidal ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Tidal ETF
The main advantage of trading using opposite ProShares Ultra and Tidal ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Tidal ETF 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 Tidal ETF will offset losses from the drop in Tidal ETF's 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 |
| Tidal ETF vs. Eaton Vance Enhanced | Tidal ETF vs. Grayscale Ethereum Mini | Tidal ETF vs. Intel | Tidal ETF vs. The Travelers Companies |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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