Correlation Between IShares Dividend and SPDR Galaxy
Can any of the company-specific risk be diversified away by investing in both IShares Dividend 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 IShares Dividend and SPDR Galaxy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Dividend and and SPDR Galaxy Digital, you can compare the effects of market volatilities on IShares Dividend 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 IShares Dividend with a short position of SPDR Galaxy. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Dividend and SPDR Galaxy.
Diversification Opportunities for IShares Dividend and SPDR Galaxy
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and SPDR is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding iShares Dividend and and SPDR Galaxy Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Galaxy Digital and IShares 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 iShares Dividend and 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 Digital has no effect on the direction of IShares Dividend i.e., IShares Dividend and SPDR Galaxy go up and down completely randomly.
Pair Corralation between IShares Dividend and SPDR Galaxy
Given the investment horizon of 90 days IShares Dividend is expected to generate 2.34 times less return on investment than SPDR Galaxy. But when comparing it to its historical volatility, iShares Dividend and is 6.04 times less risky than SPDR Galaxy. It trades about 0.32 of its potential returns per unit of risk. SPDR Galaxy Digital is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 3,301 in SPDR Galaxy Digital on November 3, 2024 and sell it today you would earn a total of 318.00 from holding SPDR Galaxy Digital or generate 9.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Dividend and vs. SPDR Galaxy Digital
Performance |
| Timeline |
| iShares Dividend |
| SPDR Galaxy Digital |
IShares Dividend and SPDR Galaxy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Dividend and SPDR Galaxy
The main advantage of trading using opposite IShares Dividend and SPDR Galaxy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Dividend 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.| IShares Dividend vs. iShares ESG Aware | IShares Dividend vs. Pacer Cash Cows | IShares Dividend vs. iShares MSCI USA | IShares Dividend vs. Invesco KBW Premium |
| SPDR Galaxy vs. iShares Dividend and | SPDR Galaxy vs. Martin Currie Sustainable | SPDR Galaxy vs. VictoryShares THB Mid | SPDR Galaxy vs. Mast Global Battery |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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