Correlation Between SPASX Dividend and SPASX 200
Can any of the company-specific risk be diversified away by investing in both SPASX Dividend and SPASX 200 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 SPASX Dividend and SPASX 200 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPASX Dividend Opportunities and SPASX 200 VIX, you can compare the effects of market volatilities on SPASX Dividend and SPASX 200 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 SPASX Dividend with a short position of SPASX 200. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPASX Dividend and SPASX 200.
Diversification Opportunities for SPASX Dividend and SPASX 200
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPASX and SPASX is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding SPASX Dividend Opportunities and SPASX 200 VIX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPASX 200 VIX and SPASX Dividend 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 SPASX Dividend Opportunities are associated (or correlated) with SPASX 200. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPASX 200 VIX has no effect on the direction of SPASX Dividend i.e., SPASX Dividend and SPASX 200 go up and down completely randomly.
Pair Corralation between SPASX Dividend and SPASX 200
Assuming the 90 days trading horizon SPASX Dividend Opportunities is expected to generate 0.05 times more return on investment than SPASX 200. However, SPASX Dividend Opportunities is 21.09 times less risky than SPASX 200. It trades about 0.21 of its potential returns per unit of risk. SPASX 200 VIX is currently generating about -0.02 per unit of risk. If you would invest 165,690 in SPASX Dividend Opportunities on September 3, 2024 and sell it today you would earn a total of 4,690 from holding SPASX Dividend Opportunities or generate 2.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPASX Dividend Opportunities vs. SPASX 200 VIX
Performance |
| Timeline |
SPASX Dividend and SPASX 200 Volatility Contrast
Predicted Return Density |
| Returns |
SPASX Dividend Opportunities
Pair trading matchups for SPASX Dividend
SPASX 200 VIX
Pair trading matchups for SPASX 200
Pair Trading with SPASX Dividend and SPASX 200
The main advantage of trading using opposite SPASX Dividend and SPASX 200 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPASX Dividend position performs unexpectedly, SPASX 200 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 SPASX 200 will offset losses from the drop in SPASX 200's long position.| SPASX Dividend vs. Spirit Telecom | SPASX Dividend vs. Australian Unity Office | SPASX Dividend vs. Saferoads Holdings | SPASX Dividend vs. Leeuwin Metals |
| SPASX 200 vs. TTG Fintech | SPASX 200 vs. Dug Technology | SPASX 200 vs. Energy Technologies Limited | SPASX 200 vs. Ainsworth Game Technology |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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