Correlation Analysis Between DOW and ProShares UltraShort

This module allows you to analyze existing cross correlation between DOW and ProShares UltraShort SmallCap600. You can compare the effects of market volatilities on DOW 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 DOW with a short position of ProShares UltraShort. See also your portfolio center. Please also check ongoing floating volatility patterns of DOW and ProShares UltraShort.
Horizon     30 Days    Login   to change
Symbolsvs

DOW  vs.  ProShares UltraShort SmallCap6

 Performance (%) 
      Timeline 

Pair Volatility

Given the investment horizon of 30 days, DOW is expected to under-perform the ProShares UltraShort. But the index apears to be less risky and, when comparing its historical volatility, DOW is 2.01 times less risky than ProShares UltraShort. The index trades about -0.05 of its potential returns per unit of risk. The ProShares UltraShort SmallCap600 is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  1,384  in ProShares UltraShort SmallCap600 on November 13, 2018 and sell it today you would earn a total of  191.84  from holding ProShares UltraShort SmallCap600 or generate 13.86% return on investment over 30 days.

Pair Corralation between DOW and ProShares UltraShort

-0.01
Time Period2 Months [change]
DirectionNegative 
StrengthInsignificant
Accuracy85.42%
ValuesDaily Returns

Diversification

DOW diversification synergy

Good diversification

Overlapping area represents the amount of risk that can be diversified away by holding DOW and ProShares UltraShort SmallCap6 in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on ProShares UltraShort and DOW 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 DOW 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 DOW i.e. DOW and ProShares UltraShort go up and down completely randomly.
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Comparative Volatility

 Predicted Return Density 
      Returns 

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