Correlation Between ProShares UltraPro and PFA Invest

By analyzing existing cross correlation between ProShares UltraPro QQQ and PFA Invest Udenlandske, you can compare the effects of market volatilities on ProShares UltraPro and PFA Invest 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 PFA Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares UltraPro and PFA Invest.

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

Diversification Opportunities for ProShares UltraPro and PFA Invest

-0.5
  Correlation Coefficient
ProShares UltraPro QQQ
PFA Invest Udenlandske

Very good diversification

The 3 months correlation between ProShares and PFIUDO is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding ProShares UltraPro QQQ and PFA Invest Udenlandske Obl in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on PFA Invest Udenlandske 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 QQQ are associated (or correlated) with PFA Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PFA Invest Udenlandske has no effect on the direction of ProShares UltraPro i.e. ProShares UltraPro and PFA Invest go up and down completely randomly.

Pair Corralation between ProShares UltraPro and PFA Invest

Given the investment horizon of 30 days, ProShares UltraPro QQQ is expected to generate 11.31 times more return on investment than PFA Invest. However, ProShares UltraPro is 11.31 times more volatile than PFA Invest Udenlandske. It trades about 0.27 of its potential returns per unit of risk. PFA Invest Udenlandske is currently generating about 0.22 per unit of risk. If you would invest  5,120  in ProShares UltraPro QQQ on June 6, 2020 and sell it today you would earn a total of  5,209  from holding ProShares UltraPro QQQ or generate 101.74% return on investment over 30 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy26.23%
ValuesDaily Returns

ProShares UltraPro QQQ  vs.  PFA Invest Udenlandske Obl

 Performance (%) 
      Timeline 
ProShares UltraPro QQQ 
1818

ProShares UltraPro Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in ProShares UltraPro QQQ are ranked lower than 18 (%) of all global equities and portfolios over the last 30 days. In spite of very unsteady forward-looking indicators, ProShares UltraPro displayed solid returns over the last few months and may actually be approaching a breakup point.
PFA Invest Udenlandske 
00

PFA Invest Risk-Adjusted Performance

Over the last 30 days PFA Invest Udenlandske has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, PFA Invest is not utilizing all of its potentials. The current stock price disturbance, may contribute to short term losses for the investors.

ProShares UltraPro and PFA Invest Volatility Contrast

 Predicted Return Density 
      Returns 
Check out your portfolio center. Please also try Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.


 
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