Correlation Between ProShares UltraPro and RiverFront Dynamic

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

By analyzing existing cross correlation between ProShares UltraPro Short and RiverFront Dynamic Dividend, you can compare the effects of market volatilities on ProShares UltraPro and RiverFront Dynamic 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 UltraPro with a short position of RiverFront Dynamic. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares UltraPro and RiverFront Dynamic.

Diversification Opportunities for ProShares UltraPro and RiverFront Dynamic

-0.75

Correlation Coefficient

ProShares UltraPro  RiverFront Dynamic

Pay attention - limited upside

The 3 months correlation between ProShares and RiverFront is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding ProShares UltraPro Short and RiverFront Dynamic Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RiverFront Dynamic and ProShares UltraPro 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 UltraPro Short are associated (or correlated) with RiverFront Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RiverFront Dynamic has no effect on the direction of ProShares UltraPro i.e., ProShares UltraPro and RiverFront Dynamic go up and down completely randomly.

Pair Corralation between ProShares UltraPro and RiverFront Dynamic

Given the investment horizon of 90 days ProShares UltraPro Short is expected to under-perform the RiverFront Dynamic. In addition to that, ProShares UltraPro is 5.24 times more volatile than RiverFront Dynamic Dividend. It trades about -0.04 of its total potential returns per unit of risk. RiverFront Dynamic Dividend is currently generating about 0.04 per unit of volatility. If you would invest  6,293  in RiverFront Dynamic Dividend on October 7, 2025 and sell it today you would earn a total of  95.00  from holding RiverFront Dynamic Dividend or generate 1.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

ProShares UltraPro Short  vs.  RiverFront Dynamic Dividend

ProShares UltraPro Short

Risk-Adjusted Performance

Weakest

Over the last 90 days ProShares UltraPro Short has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Etf's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the ETF investors.

RiverFront Dynamic

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in RiverFront Dynamic Dividend are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental indicators, RiverFront Dynamic is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ProShares UltraPro and RiverFront Dynamic

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

The idea behind ProShares UltraPro Short and RiverFront Dynamic Dividend 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.

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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.