Correlation Between Capital Group and Spinnaker ETF
Can any of the company-specific risk be diversified away by investing in both Capital Group and Spinnaker 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 Capital Group and Spinnaker ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Group Municipal and Spinnaker ETF Series, you can compare the effects of market volatilities on Capital Group and Spinnaker 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 Capital Group with a short position of Spinnaker ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Group and Spinnaker ETF.
Diversification Opportunities for Capital Group and Spinnaker ETF
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capital and Spinnaker is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Capital Group Municipal and Spinnaker ETF Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spinnaker ETF Series and Capital Group 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 Capital Group Municipal are associated (or correlated) with Spinnaker ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spinnaker ETF Series has no effect on the direction of Capital Group i.e., Capital Group and Spinnaker ETF go up and down completely randomly.
Pair Corralation between Capital Group and Spinnaker ETF
Given the investment horizon of 90 days Capital Group is expected to generate 330.47 times less return on investment than Spinnaker ETF. But when comparing it to its historical volatility, Capital Group Municipal is 347.94 times less risky than Spinnaker ETF. It trades about 0.08 of its potential returns per unit of risk. Spinnaker ETF Series is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Spinnaker ETF Series on August 26, 2024 and sell it today you would earn a total of 1,016 from holding Spinnaker ETF Series or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 32.39% |
| Values | Daily Returns |
Capital Group Municipal vs. Spinnaker ETF Series
Performance |
| Timeline |
| Capital Group Municipal |
| Spinnaker ETF Series |
Capital Group and Spinnaker ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Group and Spinnaker ETF
The main advantage of trading using opposite Capital Group and Spinnaker ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Group position performs unexpectedly, Spinnaker 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 Spinnaker ETF will offset losses from the drop in Spinnaker ETF's long position.| Capital Group vs. BlackRock Intermediate Muni | Capital Group vs. SSGA Active Trust | Capital Group vs. SPDR MarketAxess Investment | Capital Group vs. SSGA Active Trust |
| Spinnaker ETF vs. Capital Group Short | Spinnaker ETF vs. Capital Group Municipal | Spinnaker ETF vs. Capital Group Global | Spinnaker ETF vs. Capital Group Dividend |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |