Correlation Between Ultra Nasdaq-100 and Royce Small-cap
Can any of the company-specific risk be diversified away by investing in both Ultra Nasdaq-100 and Royce Small-cap 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 Ultra Nasdaq-100 and Royce Small-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultra Nasdaq 100 Profunds and Royce Small Cap Value, you can compare the effects of market volatilities on Ultra Nasdaq-100 and Royce Small-cap 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 Ultra Nasdaq-100 with a short position of Royce Small-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultra Nasdaq-100 and Royce Small-cap.
Diversification Opportunities for Ultra Nasdaq-100 and Royce Small-cap
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ultra and Royce is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Ultra Nasdaq 100 Profunds and Royce Small Cap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Royce Small Cap and Ultra Nasdaq-100 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 Ultra Nasdaq 100 Profunds are associated (or correlated) with Royce Small-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Royce Small Cap has no effect on the direction of Ultra Nasdaq-100 i.e., Ultra Nasdaq-100 and Royce Small-cap go up and down completely randomly.
Pair Corralation between Ultra Nasdaq-100 and Royce Small-cap
Assuming the 90 days horizon Ultra Nasdaq 100 Profunds is expected to generate 1.91 times more return on investment than Royce Small-cap. However, Ultra Nasdaq-100 is 1.91 times more volatile than Royce Small Cap Value. It trades about 0.14 of its potential returns per unit of risk. Royce Small Cap Value is currently generating about 0.0 per unit of risk. If you would invest 12,249 in Ultra Nasdaq 100 Profunds on September 2, 2025 and sell it today you would earn a total of 2,401 from holding Ultra Nasdaq 100 Profunds or generate 19.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ultra Nasdaq 100 Profunds vs. Royce Small Cap Value
Performance |
| Timeline |
| Ultra Nasdaq 100 |
| Royce Small Cap |
Ultra Nasdaq-100 and Royce Small-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultra Nasdaq-100 and Royce Small-cap
The main advantage of trading using opposite Ultra Nasdaq-100 and Royce Small-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultra Nasdaq-100 position performs unexpectedly, Royce Small-cap 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 Royce Small-cap will offset losses from the drop in Royce Small-cap's long position.| Ultra Nasdaq-100 vs. Payden Government Fund | Ultra Nasdaq-100 vs. Intermediate Government Bond | Ultra Nasdaq-100 vs. Us Government Securities | Ultra Nasdaq-100 vs. Ridgeworth Seix Government |
| Royce Small-cap vs. Ab E Opportunities | Royce Small-cap vs. Rational Dividend Capture | Royce Small-cap vs. Western Asset Municipal | Royce Small-cap vs. Arrow Managed Futures |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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