Correlation Between ProShares Ultra and Invesco Variable
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and Invesco Variable 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 Variable 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 Variable Rate, you can compare the effects of market volatilities on ProShares Ultra and Invesco Variable 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 Variable. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Invesco Variable.
Diversification Opportunities for ProShares Ultra and Invesco Variable
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ProShares and Invesco is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Yen and Invesco Variable Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Variable Rate 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 Variable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Variable Rate has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Invesco Variable go up and down completely randomly.
Pair Corralation between ProShares Ultra and Invesco Variable
Considering the 90-day investment horizon ProShares Ultra Yen is expected to under-perform the Invesco Variable. In addition to that, ProShares Ultra is 4.79 times more volatile than Invesco Variable Rate. It trades about -0.06 of its total potential returns per unit of risk. Invesco Variable Rate is currently generating about 0.16 per unit of volatility. If you would invest 2,183 in Invesco Variable Rate on September 12, 2024 and sell it today you would earn a total of 266.00 from holding Invesco Variable Rate or generate 12.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Ultra Yen vs. Invesco Variable Rate
Performance |
| Timeline |
| ProShares Ultra Yen |
| Invesco Variable Rate |
ProShares Ultra and Invesco Variable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and Invesco Variable
The main advantage of trading using opposite ProShares Ultra and Invesco Variable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, Invesco Variable 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 Variable will offset losses from the drop in Invesco Variable'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 Variable vs. VanEck Preferred Securities | Invesco Variable vs. First Trust Preferred | Invesco Variable vs. SPDR ICE Preferred | Invesco Variable vs. Global X SuperIncome |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |