Etracs 2x Leveraged Etf Volatility
As of now, ETRACS Etf is very steady. ETRACS 2x Leveraged secures Sharpe Ratio (or Efficiency) of 0.0969, which denotes the etf had a 0.0969% return per unit of volatility over the last 3 months. We have found twenty-one technical indicators for ETRACS 2x Leveraged, which you can use to evaluate the volatility of the entity. Please confirm ETRACS 2x's Downside Deviation of 1.08, mean deviation of 0.8683, and Market Risk Adjusted Performance of 0.8563 to check if the risk estimate we provide is consistent with the expected return of 0.11%.
ETRACS |
ETRACS 2x Etf volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of ETRACS daily returns, and it is calculated using variance and standard deviation. We also use ETRACS's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of ETRACS 2x volatility.
ETRACS 2x Leveraged Etf Volatility Analysis
Volatility refers to the frequency at which ETRACS 2x etf price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with ETRACS 2x's price changes. Investors will then calculate the volatility of ETRACS 2x's etf to predict their future moves. A etf that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A etf with relatively stable price changes has low volatility. A highly volatile etf is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of ETRACS 2x's volatility:
Historical Volatility
This type of etf volatility measures ETRACS 2x's fluctuations based on previous trends. It's commonly used to predict ETRACS 2x's future behavior based on its past. However, it cannot conclusively determine the future direction of the etf.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for ETRACS 2x's current market price. This means that the etf will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on ETRACS 2x's to be redeemed at a future date.Transformation |
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ETRACS 2x Projected Return Density Against Market
Given the investment horizon of 90 days ETRACS 2x has a beta of 0.1174 . This usually implies as returns on the market go up, ETRACS 2x average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding ETRACS 2x Leveraged will be expected to be much smaller as well.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to ETRACS 2x or UBS sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that ETRACS 2x's price will be affected by overall etf market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a ETRACS etf's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
ETRACS 2x Leveraged has an alpha of 0.0852, implying that it can generate a 0.0852 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta). Predicted Return Density |
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What Drives an ETRACS 2x Price Volatility?
Several factors can influence a etf's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.ETRACS 2x Etf Risk Measures
Given the investment horizon of 90 days the coefficient of variation of ETRACS 2x is 1031.56. The daily returns are distributed with a variance of 1.27 and standard deviation of 1.13. The mean deviation of ETRACS 2x Leveraged is currently at 0.87. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.77
α | Alpha over Dow Jones | 0.09 | |
β | Beta against Dow Jones | 0.12 | |
σ | Overall volatility | 1.13 | |
Ir | Information ratio | -0.02 |
ETRACS 2x Etf Return Volatility
ETRACS 2x historical daily return volatility represents how much of ETRACS 2x etf's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The ETF venture inherits 1.1281% risk (volatility on return distribution) over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.7626% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About ETRACS 2x Volatility
Volatility is a rate at which the price of ETRACS 2x or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of ETRACS 2x may increase or decrease. In other words, similar to ETRACS's beta indicator, it measures the risk of ETRACS 2x and helps estimate the fluctuations that may happen in a short period of time. So if prices of ETRACS 2x fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.3 ways to utilize ETRACS 2x's volatility to invest better
Higher ETRACS 2x's etf volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of ETRACS 2x Leveraged etf is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. ETRACS 2x Leveraged etf volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of ETRACS 2x Leveraged investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in ETRACS 2x's etf can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of ETRACS 2x's etf relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
ETRACS 2x Investment Opportunity
ETRACS 2x Leveraged has a volatility of 1.13 and is 1.49 times more volatile than Dow Jones Industrial. Compared to the overall equity markets, volatility of historical daily returns of ETRACS 2x Leveraged is lower than 10 percent of all global equities and portfolios over the last 90 days. You can use ETRACS 2x Leveraged to enhance the returns of your portfolios. The etf experiences a large bullish trend. Check odds of ETRACS 2x to be traded at $47.03 in 90 days.Significant diversification
The correlation between ETRACS 2x Leveraged and DJI is 0.08 (i.e., Significant diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding ETRACS 2x Leveraged and DJI in the same portfolio, assuming nothing else is changed.
ETRACS 2x Additional Risk Indicators
The analysis of ETRACS 2x's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in ETRACS 2x's investment and either accepting that risk or mitigating it. Along with some common measures of ETRACS 2x etf's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0775 | |||
| Market Risk Adjusted Performance | 0.8563 | |||
| Mean Deviation | 0.8683 | |||
| Semi Deviation | 0.9204 | |||
| Downside Deviation | 1.08 | |||
| Coefficient Of Variation | 1031.56 | |||
| Standard Deviation | 1.13 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential etfs, we recommend comparing similar etfs with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
ETRACS 2x Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against ETRACS 2x as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. ETRACS 2x's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, ETRACS 2x's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to ETRACS 2x Leveraged.
When determining whether ETRACS 2x Leveraged is a strong investment it is important to analyze ETRACS 2x's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact ETRACS 2x's future performance. For an informed investment choice regarding ETRACS Etf, refer to the following important reports: Check out World Market Map to better understand how to build diversified portfolios, which includes a position in ETRACS 2x Leveraged. Also, note that the market value of any etf could be closely tied with the direction of predictive economic indicators such as signals in population. You can also try the Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
The market value of ETRACS 2x Leveraged is measured differently than its book value, which is the value of ETRACS that is recorded on the company's balance sheet. Investors also form their own opinion of ETRACS 2x's value that differs from its market value or its book value, called intrinsic value, which is ETRACS 2x's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because ETRACS 2x's market value can be influenced by many factors that don't directly affect ETRACS 2x's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between ETRACS 2x's value and its price as these two are different measures arrived at by different means. Investors typically determine if ETRACS 2x is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, ETRACS 2x's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.