Correlation Between ProShares Trust and SPDR SSGA

Can any of the company-specific risk be diversified away by investing in both ProShares Trust and SPDR SSGA 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 Trust and SPDR SSGA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ProShares Trust and SPDR SSGA My2028, you can compare the effects of market volatilities on ProShares Trust and SPDR SSGA 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 Trust with a short position of SPDR SSGA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Trust and SPDR SSGA.

Diversification Opportunities for ProShares Trust and SPDR SSGA

0.27

Correlation Coefficient

ProShares Trust  SPDR SSGA

Modest diversification

The 3 months correlation between ProShares and SPDR is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Trust and SPDR SSGA My2028 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SSGA My2028 and ProShares Trust 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 Trust are associated (or correlated) with SPDR SSGA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SSGA My2028 has no effect on the direction of ProShares Trust i.e., ProShares Trust and SPDR SSGA go up and down completely randomly.

Pair Corralation between ProShares Trust and SPDR SSGA

Given the investment horizon of 90 days ProShares Trust is expected to generate 22.24 times more return on investment than SPDR SSGA. However, ProShares Trust is 22.24 times more volatile than SPDR SSGA My2028. It trades about 0.08 of its potential returns per unit of risk. SPDR SSGA My2028 is currently generating about 0.23 per unit of risk. If you would invest  7,365  in ProShares Trust on July 2, 2025 and sell it today you would earn a total of  786.00  from holding ProShares Trust or generate 10.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

ProShares Trust  vs.  SPDR SSGA My2028

ProShares Trust

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in ProShares Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, ProShares Trust may actually be approaching a critical reversion point that can send shares even higher in October 2025.

SPDR SSGA My2028

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR SSGA My2028 are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong primary indicators, SPDR SSGA is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with ProShares Trust and SPDR SSGA

The main advantage of trading using opposite ProShares Trust and SPDR SSGA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Trust position performs unexpectedly, SPDR SSGA 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 SPDR SSGA will offset losses from the drop in SPDR SSGA's long position.

The idea behind ProShares Trust and SPDR SSGA My2028 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.