Correlation Between ProShares Ultra and Invesco Golden
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Invesco Golden 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 Invesco Golden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Ultra Yen and Invesco Golden Dragon, you can compare the effects of market volatilities on ProShares Ultra and Invesco Golden 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 Invesco Golden. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Invesco Golden.
Diversification Opportunities for ProShares Ultra and Invesco Golden
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ProShares and Invesco is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Yen and Invesco Golden Dragon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Golden Dragon 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 Yen are associated (or correlated) with Invesco Golden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Golden Dragon has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Invesco Golden go up and down completely randomly.
Pair Corralation between ProShares Ultra and Invesco Golden
Considering the 90-day investment horizon ProShares Ultra Yen is expected to under-perform the Invesco Golden. But the etf apears to be less risky and, when comparing its historical volatility, ProShares Ultra Yen is 1.54 times less risky than Invesco Golden. The etf trades about -0.04 of its potential returns per unit of risk. The Invesco Golden Dragon is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,570 in Invesco Golden Dragon on September 2, 2024 and sell it today you would earn a total of 27.00 from holding Invesco Golden Dragon or generate 1.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Ultra Yen vs. Invesco Golden Dragon
Performance |
| Timeline |
| ProShares Ultra Yen |
| Invesco Golden Dragon |
ProShares Ultra and Invesco Golden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Invesco Golden
The main advantage of trading using opposite ProShares Ultra and Invesco Golden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Invesco Golden 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 Invesco Golden will offset losses from the drop in Invesco Golden's long position.| ProShares Ultra vs. ProShares Ultra Euro | ProShares Ultra vs. ProShares UltraShort Yen | ProShares Ultra vs. ProShares Ultra Telecommunications | ProShares Ultra vs. ProShares Ultra Consumer |
| Invesco Golden vs. SPDR SP China | Invesco Golden vs. iShares MSCI Hong | Invesco Golden vs. iShares China Large Cap | Invesco Golden vs. iShares MSCI Singapore |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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