Correlation Between ProShares Ultra and VictoryShares Dividend
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and VictoryShares Dividend 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 VictoryShares Dividend 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 VictoryShares Dividend Accelerator, you can compare the effects of market volatilities on ProShares Ultra and VictoryShares Dividend 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 VictoryShares Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and VictoryShares Dividend.
Diversification Opportunities for ProShares Ultra and VictoryShares Dividend
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ProShares and VictoryShares is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Yen and VictoryShares Dividend Acceler in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VictoryShares Dividend 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 VictoryShares Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VictoryShares Dividend has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and VictoryShares Dividend go up and down completely randomly.
Pair Corralation between ProShares Ultra and VictoryShares Dividend
Considering the 90-day investment horizon ProShares Ultra is expected to generate 2.03 times less return on investment than VictoryShares Dividend. In addition to that, ProShares Ultra is 2.76 times more volatile than VictoryShares Dividend Accelerator. It trades about 0.07 of its total potential returns per unit of risk. VictoryShares Dividend Accelerator is currently generating about 0.4 per unit of volatility. If you would invest 5,207 in VictoryShares Dividend Accelerator on August 30, 2024 and sell it today you would earn a total of 297.00 from holding VictoryShares Dividend Accelerator or generate 5.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
ProShares Ultra Yen vs. VictoryShares Dividend Acceler
Performance |
| Timeline |
| ProShares Ultra Yen |
| VictoryShares Dividend |
ProShares Ultra and VictoryShares Dividend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and VictoryShares Dividend
The main advantage of trading using opposite ProShares Ultra and VictoryShares Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, VictoryShares Dividend 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 VictoryShares Dividend will offset losses from the drop in VictoryShares Dividend'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 |
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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