Correlation Between ProShares Ultra and Sprott Physical

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

By analyzing existing cross correlation between ProShares Ultra Yen and Sprott Physical Platinum, you can compare the effects of market volatilities on ProShares Ultra and Sprott Physical 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 Ultra with a short position of Sprott Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and Sprott Physical.

Diversification Opportunities for ProShares Ultra and Sprott Physical

-0.74

Correlation Coefficient

ProShares Ultra  Sprott Physical

Pay attention - limited upside

The 3 months correlation between ProShares and Sprott is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Yen and Sprott Physical Platinum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Physical Platinum and ProShares Ultra 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 Ultra Yen are associated (or correlated) with Sprott Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Physical Platinum has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and Sprott Physical go up and down completely randomly.

Pair Corralation between ProShares Ultra and Sprott Physical

Considering the 90-day investment horizon ProShares Ultra Yen is expected to under-perform the Sprott Physical. But the etf apears to be less risky and, when comparing its historical volatility, ProShares Ultra Yen is 1.74 times less risky than Sprott Physical. The etf trades about -0.07 of its potential returns per unit of risk. The Sprott Physical Platinum is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  1,022  in Sprott Physical Platinum on May 28, 2025 and sell it today you would earn a total of  175.00  from holding Sprott Physical Platinum or generate 17.12% return on investment over 90 days.

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

ProShares Ultra Yen  vs.  Sprott Physical Platinum

ProShares Ultra Yen

Risk-Adjusted Performance

Weakest

Over the last 90 days ProShares Ultra Yen has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental indicators, ProShares Ultra is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Sprott Physical Platinum

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Sprott Physical Platinum are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Sprott Physical reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ProShares Ultra and Sprott Physical

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

The idea behind ProShares Ultra Yen and Sprott Physical Platinum 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.