Correlation Between IShares Core and SPDR Series
Can any of the company-specific risk be diversified away by investing in both IShares Core and SPDR Series 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 IShares Core and SPDR Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Core Dividend and SPDR Series Trust, you can compare the effects of market volatilities on IShares Core and SPDR Series 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 IShares Core with a short position of SPDR Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and SPDR Series.
Diversification Opportunities for IShares Core and SPDR Series
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and SPDR is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core Dividend and SPDR Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Series Trust and IShares Core 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 iShares Core Dividend are associated (or correlated) with SPDR Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Series Trust has no effect on the direction of IShares Core i.e., IShares Core and SPDR Series go up and down completely randomly.
Pair Corralation between IShares Core and SPDR Series
Given the investment horizon of 90 days iShares Core Dividend is expected to generate 0.74 times more return on investment than SPDR Series. However, iShares Core Dividend is 1.35 times less risky than SPDR Series. It trades about 0.31 of its potential returns per unit of risk. SPDR Series Trust is currently generating about 0.19 per unit of risk. If you would invest 6,134 in iShares Core Dividend on November 1, 2024 and sell it today you would earn a total of 251.00 from holding iShares Core Dividend or generate 4.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Core Dividend vs. SPDR Series Trust
Performance |
| Timeline |
| iShares Core Dividend |
| SPDR Series Trust |
IShares Core and SPDR Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Core and SPDR Series
The main advantage of trading using opposite IShares Core and SPDR Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, SPDR Series 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 Series will offset losses from the drop in SPDR Series' long position.| IShares Core vs. iShares Core High | IShares Core vs. Schwab Dividend Equity | IShares Core vs. ProShares SP 500 | IShares Core vs. Invesco SP 500 |
| SPDR Series vs. Vanguard Value Index | SPDR Series vs. Vanguard High Dividend | SPDR Series vs. iShares Russell 1000 | SPDR Series vs. iShares Core 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |