Correlation Between SPDR Bloomberg and BNY Mellon
Can any of the company-specific risk be diversified away by investing in both SPDR Bloomberg and BNY Mellon 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 SPDR Bloomberg and BNY Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Bloomberg 1 3 and BNY Mellon ETF, you can compare the effects of market volatilities on SPDR Bloomberg and BNY Mellon 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 SPDR Bloomberg with a short position of BNY Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Bloomberg and BNY Mellon.
Diversification Opportunities for SPDR Bloomberg and BNY Mellon
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SPDR and BNY is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Bloomberg 1 3 and BNY Mellon ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNY Mellon ETF and SPDR Bloomberg 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 SPDR Bloomberg 1 3 are associated (or correlated) with BNY Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNY Mellon ETF has no effect on the direction of SPDR Bloomberg i.e., SPDR Bloomberg and BNY Mellon go up and down completely randomly.
Pair Corralation between SPDR Bloomberg and BNY Mellon
Considering the 90-day investment horizon SPDR Bloomberg 1 3 is expected to generate 0.72 times more return on investment than BNY Mellon. However, SPDR Bloomberg 1 3 is 1.39 times less risky than BNY Mellon. It trades about 0.81 of its potential returns per unit of risk. BNY Mellon ETF is currently generating about 0.54 per unit of risk. If you would invest 9,141 in SPDR Bloomberg 1 3 on August 30, 2024 and sell it today you would earn a total of 32.00 from holding SPDR Bloomberg 1 3 or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Bloomberg 1 3 vs. BNY Mellon ETF
Performance |
| Timeline |
| SPDR Bloomberg 1 |
| BNY Mellon ETF |
SPDR Bloomberg and BNY Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Bloomberg and BNY Mellon
The main advantage of trading using opposite SPDR Bloomberg and BNY Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Bloomberg position performs unexpectedly, BNY Mellon 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 BNY Mellon will offset losses from the drop in BNY Mellon's long position.| SPDR Bloomberg vs. Global X Funds | SPDR Bloomberg vs. US Treasury 12 | SPDR Bloomberg vs. Tidal Trust II | SPDR Bloomberg vs. Franklin Liberty Treasury |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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