Correlation Between SSgA SPDR and ETHetc ETC
Can any of the company-specific risk be diversified away by investing in both SSgA SPDR and ETHetc ETC 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 SSgA SPDR and ETHetc ETC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SSgA SPDR ETFs and ETHetc ETC, you can compare the effects of market volatilities on SSgA SPDR and ETHetc ETC 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 SSgA SPDR with a short position of ETHetc ETC. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSgA SPDR and ETHetc ETC.
Diversification Opportunities for SSgA SPDR and ETHetc ETC
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SSgA and ETHetc is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding SSgA SPDR ETFs and ETHetc ETC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETHetc ETC and SSgA SPDR 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 SSgA SPDR ETFs are associated (or correlated) with ETHetc ETC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETHetc ETC has no effect on the direction of SSgA SPDR i.e., SSgA SPDR and ETHetc ETC go up and down completely randomly.
Pair Corralation between SSgA SPDR and ETHetc ETC
Assuming the 90 days trading horizon SSgA SPDR is expected to generate 14.19 times less return on investment than ETHetc ETC. But when comparing it to its historical volatility, SSgA SPDR ETFs is 5.4 times less risky than ETHetc ETC. It trades about 0.03 of its potential returns per unit of risk. ETHetc ETC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,046 in ETHetc ETC on September 20, 2024 and sell it today you would earn a total of 1,434 from holding ETHetc ETC or generate 70.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
SSgA SPDR ETFs vs. ETHetc ETC
Performance |
| Timeline |
| SSgA SPDR ETFs |
| ETHetc ETC |
SSgA SPDR and ETHetc ETC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSgA SPDR and ETHetc ETC
The main advantage of trading using opposite SSgA SPDR and ETHetc ETC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSgA SPDR position performs unexpectedly, ETHetc ETC 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 ETHetc ETC will offset losses from the drop in ETHetc ETC's long position.| SSgA SPDR vs. Lyxor UCITS Japan | SSgA SPDR vs. Lyxor UCITS Japan | SSgA SPDR vs. Lyxor UCITS Stoxx | SSgA SPDR vs. Gold Bullion Securities |
| ETHetc ETC vs. Amundi Index Solutions | ETHetc ETC vs. Multi Units Luxembourg | ETHetc ETC vs. iShares Digital Entertainment | ETHetc ETC vs. Amundi Index Solutions |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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