Correlation Between ProShares Ultra and DBX ETF

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Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and DBX ETF 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 DBX ETF 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 DBX ETF Trust, you can compare the effects of market volatilities on ProShares Ultra and DBX ETF 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 DBX ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and DBX ETF.

Diversification Opportunities for ProShares Ultra and DBX ETF

-0.8
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between ProShares and DBX is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra Yen and DBX ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBX ETF Trust 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 DBX ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBX ETF Trust has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and DBX ETF go up and down completely randomly.

Pair Corralation between ProShares Ultra and DBX ETF

Considering the 90-day investment horizon ProShares Ultra Yen is expected to under-perform the DBX ETF. In addition to that, ProShares Ultra is 1.35 times more volatile than DBX ETF Trust. It trades about -0.05 of its total potential returns per unit of risk. DBX ETF Trust is currently generating about 0.05 per unit of volatility. If you would invest  2,238  in DBX ETF Trust on September 6, 2024 and sell it today you would earn a total of  541.00  from holding DBX ETF Trust or generate 24.17% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy95.76%
ValuesDaily Returns

ProShares Ultra Yen  vs.  DBX ETF Trust

 Performance 
       Timeline  
ProShares Ultra Yen 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ProShares Ultra Yen has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Etf's fundamental indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the ETF venture institutional investors.
DBX ETF Trust 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Good
Over the last 90 days DBX ETF Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly fragile basic indicators, DBX ETF may actually be approaching a critical reversion point that can send shares even higher in January 2025.

ProShares Ultra and DBX ETF Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with ProShares Ultra and DBX ETF

The main advantage of trading using opposite ProShares Ultra and DBX ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, DBX ETF 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 DBX ETF will offset losses from the drop in DBX ETF's long position.
The idea behind ProShares Ultra Yen and DBX ETF Trust 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.

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