Correlation Between DXC Technology and ProShares UltraShort

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

By analyzing existing cross correlation between DXC Technology Co and ProShares UltraShort Utilities, you can compare the effects of market volatilities on DXC Technology 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 DXC Technology with a short position of ProShares UltraShort. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and ProShares UltraShort.

Diversification Opportunities for DXC Technology and ProShares UltraShort

0.0

Correlation Coefficient

DXC Technology  ProShares UltraShort

Pay attention - limited upside

The 3 months correlation between DXC and ProShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and ProShares UltraShort Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares UltraShort and DXC Technology 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 DXC Technology Co 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 DXC Technology i.e., DXC Technology and ProShares UltraShort go up and down completely randomly.

Pair Corralation between DXC Technology and ProShares UltraShort

Considering the 90-day investment horizon DXC Technology Co is expected to generate 1.45 times more return on investment than ProShares UltraShort. However, DXC Technology is 1.45 times more volatile than ProShares UltraShort Utilities. It trades about 0.03 of its potential returns per unit of risk. ProShares UltraShort Utilities is currently generating about -0.17 per unit of risk. If you would invest  1,403  in DXC Technology Co on April 20, 2025 and sell it today you would earn a total of  36.00  from holding DXC Technology Co or generate 2.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

DXC Technology Co  vs.  ProShares UltraShort Utilities

DXC Technology

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in DXC Technology Co are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, DXC Technology is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

ProShares UltraShort

Risk-Adjusted Performance

Very Weak

Over the last 90 days ProShares UltraShort Utilities has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Etf's fundamental indicators remain relatively invariable which may send shares a bit higher in August 2025. The latest agitation may also be a sign of long-running up-swing for the ETF retail investors.

Pair Trading with DXC Technology and ProShares UltraShort

The main advantage of trading using opposite DXC Technology and ProShares UltraShort positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DXC Technology 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.

The idea behind DXC Technology Co and ProShares UltraShort Utilities 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.