Correlation Between Vanguard Growth and ProShares UltraPro
Can any of the company-specific risk be diversified away by investing in both Vanguard Growth and ProShares UltraPro 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 Vanguard Growth and ProShares UltraPro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Growth Index and ProShares UltraPro Short, you can compare the effects of market volatilities on Vanguard Growth and ProShares UltraPro 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 Vanguard Growth with a short position of ProShares UltraPro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Growth and ProShares UltraPro.
Diversification Opportunities for Vanguard Growth and ProShares UltraPro
-0.98 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Vanguard and ProShares is -0.98. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Growth Index and ProShares UltraPro Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares UltraPro Short and Vanguard Growth 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 Vanguard Growth Index are associated (or correlated) with ProShares UltraPro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares UltraPro Short has no effect on the direction of Vanguard Growth i.e., Vanguard Growth and ProShares UltraPro go up and down completely randomly.
Pair Corralation between Vanguard Growth and ProShares UltraPro
Considering the 90-day investment horizon Vanguard Growth Index is expected to generate 0.31 times more return on investment than ProShares UltraPro. However, Vanguard Growth Index is 3.25 times less risky than ProShares UltraPro. It trades about 0.31 of its potential returns per unit of risk. ProShares UltraPro Short is currently generating about -0.2 per unit of risk. If you would invest 38,599 in Vanguard Growth Index on September 2, 2024 and sell it today you would earn a total of 2,314 from holding Vanguard Growth Index or generate 5.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Growth Index vs. ProShares UltraPro Short
Performance |
| Timeline |
| Vanguard Growth Index |
| ProShares UltraPro Short |
Vanguard Growth and ProShares UltraPro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Growth and ProShares UltraPro
The main advantage of trading using opposite Vanguard Growth and ProShares UltraPro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Growth position performs unexpectedly, ProShares UltraPro 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 ProShares UltraPro will offset losses from the drop in ProShares UltraPro's long position.| Vanguard Growth vs. Vanguard Value Index | Vanguard Growth vs. Vanguard Information Technology | Vanguard Growth vs. Vanguard Small Cap Growth | Vanguard Growth vs. Vanguard Dividend Appreciation |
| ProShares UltraPro vs. ProShares UltraPro QQQ | ProShares UltraPro vs. ProShares UltraPro Short | ProShares UltraPro vs. ProShares UltraPro Short | ProShares UltraPro vs. ProShares Ultra VIX |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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