Correlation Between Siren Nasdaq and SPDR Galaxy
Can any of the company-specific risk be diversified away by investing in both Siren Nasdaq and SPDR Galaxy 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 Siren Nasdaq and SPDR Galaxy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siren Nasdaq NexGen and SPDR Galaxy Hedged, you can compare the effects of market volatilities on Siren Nasdaq and SPDR Galaxy 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 Siren Nasdaq with a short position of SPDR Galaxy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siren Nasdaq and SPDR Galaxy.
Diversification Opportunities for Siren Nasdaq and SPDR Galaxy
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Siren and SPDR is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Siren Nasdaq NexGen and SPDR Galaxy Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Galaxy Hedged and Siren Nasdaq 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 Siren Nasdaq NexGen are associated (or correlated) with SPDR Galaxy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Galaxy Hedged has no effect on the direction of Siren Nasdaq i.e., Siren Nasdaq and SPDR Galaxy go up and down completely randomly.
Pair Corralation between Siren Nasdaq and SPDR Galaxy
Given the investment horizon of 90 days Siren Nasdaq is expected to generate 4.26 times less return on investment than SPDR Galaxy. But when comparing it to its historical volatility, Siren Nasdaq NexGen is 1.29 times less risky than SPDR Galaxy. It trades about 0.06 of its potential returns per unit of risk. SPDR Galaxy Hedged is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 2,525 in SPDR Galaxy Hedged on September 12, 2024 and sell it today you would earn a total of 1,113 from holding SPDR Galaxy Hedged or generate 44.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 19.94% |
| Values | Daily Returns |
Siren Nasdaq NexGen vs. SPDR Galaxy Hedged
Performance |
| Timeline |
| Siren Nasdaq NexGen |
| SPDR Galaxy Hedged |
Siren Nasdaq and SPDR Galaxy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siren Nasdaq and SPDR Galaxy
The main advantage of trading using opposite Siren Nasdaq and SPDR Galaxy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siren Nasdaq position performs unexpectedly, SPDR Galaxy 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 SPDR Galaxy will offset losses from the drop in SPDR Galaxy's long position.| Siren Nasdaq vs. Grayscale Bitcoin Trust | Siren Nasdaq vs. First Trust Indxx | Siren Nasdaq vs. Bitwise Crypto Industry | Siren Nasdaq vs. Grayscale Bitcoin Mini |
| SPDR Galaxy vs. Grayscale Bitcoin Trust | SPDR Galaxy vs. Siren Nasdaq NexGen | SPDR Galaxy vs. First Trust Indxx | SPDR Galaxy vs. Bitwise Crypto Industry |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |