Correlation Between GraniteShares FATANG and SSgA SPDR
Can any of the company-specific risk be diversified away by investing in both GraniteShares FATANG and SSgA SPDR 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 GraniteShares FATANG and SSgA SPDR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares FATANG ETC and SSgA SPDR ETFs, you can compare the effects of market volatilities on GraniteShares FATANG and SSgA SPDR 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 GraniteShares FATANG with a short position of SSgA SPDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares FATANG and SSgA SPDR.
Diversification Opportunities for GraniteShares FATANG and SSgA SPDR
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GraniteShares and SSgA is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares FATANG ETC and SSgA SPDR ETFs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSgA SPDR ETFs and GraniteShares FATANG 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 GraniteShares FATANG ETC are associated (or correlated) with SSgA SPDR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSgA SPDR ETFs has no effect on the direction of GraniteShares FATANG i.e., GraniteShares FATANG and SSgA SPDR go up and down completely randomly.
Pair Corralation between GraniteShares FATANG and SSgA SPDR
Assuming the 90 days trading horizon GraniteShares FATANG ETC is expected to generate 4.51 times more return on investment than SSgA SPDR. However, GraniteShares FATANG is 4.51 times more volatile than SSgA SPDR ETFs. It trades about 0.33 of its potential returns per unit of risk. SSgA SPDR ETFs is currently generating about 0.04 per unit of risk. If you would invest 4,272 in GraniteShares FATANG ETC on August 28, 2024 and sell it today you would earn a total of 513.00 from holding GraniteShares FATANG ETC or generate 12.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
GraniteShares FATANG ETC vs. SSgA SPDR ETFs
Performance |
| Timeline |
| GraniteShares FATANG ETC |
| SSgA SPDR ETFs |
GraniteShares FATANG and SSgA SPDR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares FATANG and SSgA SPDR
The main advantage of trading using opposite GraniteShares FATANG and SSgA SPDR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares FATANG position performs unexpectedly, SSgA SPDR 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 SSgA SPDR will offset losses from the drop in SSgA SPDR's long position.| GraniteShares FATANG vs. WisdomTree SP 500 | GraniteShares FATANG vs. WisdomTree Silver 3x | GraniteShares FATANG vs. Lyxor 10Y Inflation | GraniteShares FATANG vs. GraniteShares 3x Short |
| SSgA SPDR vs. Leverage Shares 3x | SSgA SPDR vs. Leverage Shares 3x | SSgA SPDR vs. Leverage Shares 3x | SSgA SPDR vs. WisdomTree Short GBP |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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