Correlation Between ProShares UltraShort and ProShares UltraShort
Can any of the company-specific risk be diversified away by investing in both ProShares UltraShort and ProShares UltraShort 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 UltraShort and ProShares UltraShort into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares UltraShort QQQ and ProShares UltraShort Utilities, you can compare the effects of market volatilities on ProShares UltraShort and ProShares UltraShort 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 UltraShort with a short position of ProShares UltraShort. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares UltraShort and ProShares UltraShort.
Diversification Opportunities for ProShares UltraShort and ProShares UltraShort
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between ProShares and ProShares is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding ProShares UltraShort QQQ and ProShares UltraShort Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares UltraShort and ProShares UltraShort 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 UltraShort QQQ are associated (or correlated) with ProShares UltraShort. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares UltraShort has no effect on the direction of ProShares UltraShort i.e., ProShares UltraShort and ProShares UltraShort go up and down completely randomly.
Pair Corralation between ProShares UltraShort and ProShares UltraShort
Considering the 90-day investment horizon ProShares UltraShort QQQ is expected to generate 1.03 times more return on investment than ProShares UltraShort. However, ProShares UltraShort is 1.03 times more volatile than ProShares UltraShort Utilities. It trades about -0.08 of its potential returns per unit of risk. ProShares UltraShort Utilities is currently generating about -0.31 per unit of risk. If you would invest 930.00 in ProShares UltraShort QQQ on December 30, 2023 and sell it today you would lose (34.00) from holding ProShares UltraShort QQQ or give up 3.66% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ProShares UltraShort QQQ vs. ProShares UltraShort Utilities
Performance |
Timeline |
ProShares UltraShort QQQ |
ProShares UltraShort |
ProShares UltraShort and ProShares UltraShort Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ProShares UltraShort and ProShares UltraShort
The main advantage of trading using opposite ProShares UltraShort and ProShares UltraShort positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares UltraShort position performs unexpectedly, ProShares UltraShort 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 UltraShort will offset losses from the drop in ProShares UltraShort's long position.ProShares UltraShort vs. Northern Lights | ProShares UltraShort vs. Dimensional International High | ProShares UltraShort vs. First Trust Exchange Traded | ProShares UltraShort vs. EA Series Trust |
ProShares UltraShort vs. First Trust Utilities | ProShares UltraShort vs. IShares US Utilities | ProShares UltraShort vs. Fidelity MSCI Utilities | ProShares UltraShort vs. IShares Global Utilities |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |