Correlation Between Eaton Vance and SPDR SP
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and SPDR SP 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 Eaton Vance and SPDR SP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Enhanced and SPDR SP Health, you can compare the effects of market volatilities on Eaton Vance and SPDR SP 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 Eaton Vance with a short position of SPDR SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and SPDR SP.
Diversification Opportunities for Eaton Vance and SPDR SP
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eaton and SPDR is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Enhanced and SPDR SP Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SP Health and Eaton Vance 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 Eaton Vance Enhanced are associated (or correlated) with SPDR SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SP Health has no effect on the direction of Eaton Vance i.e., Eaton Vance and SPDR SP go up and down completely randomly.
Pair Corralation between Eaton Vance and SPDR SP
Considering the 90-day investment horizon Eaton Vance Enhanced is expected to generate 0.9 times more return on investment than SPDR SP. However, Eaton Vance Enhanced is 1.11 times less risky than SPDR SP. It trades about 0.13 of its potential returns per unit of risk. SPDR SP Health is currently generating about 0.04 per unit of risk. If you would invest 1,708 in Eaton Vance Enhanced on August 27, 2024 and sell it today you would earn a total of 607.00 from holding Eaton Vance Enhanced or generate 35.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance Enhanced vs. SPDR SP Health
Performance |
| Timeline |
| Eaton Vance Enhanced |
| SPDR SP Health |
Eaton Vance and SPDR SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and SPDR SP
The main advantage of trading using opposite Eaton Vance and SPDR SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, SPDR SP 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 SP will offset losses from the drop in SPDR SP's long position.| Eaton Vance vs. Columbia Seligman Premium | Eaton Vance vs. BlackRock Utility Infrastructure | Eaton Vance vs. BlackRock Health Sciences | Eaton Vance vs. BlackRock Science Tech |
| SPDR SP vs. SPDR SP Health | SPDR SP vs. SPDR SP Software | SPDR SP vs. SPDR SP Telecom | SPDR SP vs. SPDR SP Pharmaceuticals |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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