Correlation Between SPDR SSgA and Draco Evolution
Can any of the company-specific risk be diversified away by investing in both SPDR SSgA and Draco Evolution 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 SPDR SSgA and Draco Evolution into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR SSgA Global and Draco Evolution AI, you can compare the effects of market volatilities on SPDR SSgA and Draco Evolution 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 SPDR SSgA with a short position of Draco Evolution. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR SSgA and Draco Evolution.
Diversification Opportunities for SPDR SSgA and Draco Evolution
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SPDR and Draco is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding SPDR SSgA Global and Draco Evolution AI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Draco Evolution AI and SPDR SSgA 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 SPDR SSgA Global are associated (or correlated) with Draco Evolution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Draco Evolution AI has no effect on the direction of SPDR SSgA i.e., SPDR SSgA and Draco Evolution go up and down completely randomly.
Pair Corralation between SPDR SSgA and Draco Evolution
Considering the 90-day investment horizon SPDR SSgA Global is expected to generate 0.47 times more return on investment than Draco Evolution. However, SPDR SSgA Global is 2.12 times less risky than Draco Evolution. It trades about 0.07 of its potential returns per unit of risk. Draco Evolution AI is currently generating about -0.02 per unit of risk. If you would invest 3,741 in SPDR SSgA Global on October 25, 2024 and sell it today you would earn a total of 759.00 from holding SPDR SSgA Global or generate 20.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 27.38% |
| Values | Daily Returns |
SPDR SSgA Global vs. Draco Evolution AI
Performance |
| Timeline |
| SPDR SSgA Global |
| Draco Evolution AI |
SPDR SSgA and Draco Evolution Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR SSgA and Draco Evolution
The main advantage of trading using opposite SPDR SSgA and Draco Evolution positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR SSgA position performs unexpectedly, Draco Evolution 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 Draco Evolution will offset losses from the drop in Draco Evolution's long position.| SPDR SSgA vs. SPDR SSgA Income | SPDR SSgA vs. SPDR SSgA Multi Asset | SPDR SSgA vs. SPDR Bloomberg International | SPDR SSgA vs. SPDR Bloomberg Emerging |
| Draco Evolution vs. First Trust Multi Asset | Draco Evolution vs. Collaborative Investment Series | Draco Evolution vs. Aptus Defined Risk | Draco Evolution vs. Discipline Fund ETF |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |