Correlation Between ProShares Ultra and Amplify Thematic
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Amplify Thematic 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 Amplify Thematic 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 Amplify Thematic All Stars, you can compare the effects of market volatilities on ProShares Ultra and Amplify Thematic 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 Amplify Thematic. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Amplify Thematic.
Diversification Opportunities for ProShares Ultra and Amplify Thematic
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ProShares and Amplify is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Semiconductors and Amplify Thematic All Stars in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify Thematic All 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 Amplify Thematic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify Thematic All has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Amplify Thematic go up and down completely randomly.
Pair Corralation between ProShares Ultra and Amplify Thematic
Considering the 90-day investment horizon ProShares Ultra Semiconductors is expected to under-perform the Amplify Thematic. In addition to that, ProShares Ultra is 2.87 times more volatile than Amplify Thematic All Stars. It trades about -0.15 of its total potential returns per unit of risk. Amplify Thematic All Stars is currently generating about 0.19 per unit of volatility. If you would invest 2,276 in Amplify Thematic All Stars on August 30, 2024 and sell it today you would earn a total of 135.00 from holding Amplify Thematic All Stars or generate 5.93% 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. Amplify Thematic All Stars
Performance |
| Timeline |
| ProShares Ultra Semi |
| Amplify Thematic All |
ProShares Ultra and Amplify Thematic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Amplify Thematic
The main advantage of trading using opposite ProShares Ultra and Amplify Thematic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Amplify Thematic 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 Amplify Thematic will offset losses from the drop in Amplify Thematic's long position.| ProShares Ultra vs. ABIVAX Socit Anonyme | ProShares Ultra vs. Morningstar Unconstrained Allocation | ProShares Ultra vs. SPACE | ProShares Ultra vs. Knife River |
| Amplify Thematic vs. Nexalin Technology | Amplify Thematic vs. Kilroy Realty Corp | Amplify Thematic vs. Highwoods Properties | Amplify Thematic vs. Karat Packaging |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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