Correlation Between SPDR Gold and Apple
Can any of the company-specific risk be diversified away by investing in both SPDR Gold and Apple 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 Gold and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Gold Shares and Apple Inc, you can compare the effects of market volatilities on SPDR Gold and Apple 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 Gold with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Gold and Apple.
Diversification Opportunities for SPDR Gold and Apple
Poor diversification
The 3 months correlation between SPDR and Apple is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Gold Shares and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and SPDR Gold 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 Gold Shares are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of SPDR Gold i.e., SPDR Gold and Apple go up and down completely randomly.
Pair Corralation between SPDR Gold and Apple
Assuming the 90 days trading horizon SPDR Gold is expected to generate 2.02 times less return on investment than Apple. In addition to that, SPDR Gold is 1.31 times more volatile than Apple Inc. It trades about 0.21 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.56 per unit of volatility. If you would invest 21,145 in Apple Inc on September 13, 2024 and sell it today you would earn a total of 2,570 from holding Apple Inc or generate 12.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Gold Shares vs. Apple Inc
Performance |
| Timeline |
| SPDR Gold Shares |
| Apple Inc |
SPDR Gold and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Gold and Apple
The main advantage of trading using opposite SPDR Gold and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Gold position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| SPDR Gold vs. HYATT HOTELS A | SPDR Gold vs. InterContinental Hotels Group | SPDR Gold vs. Science Applications International | SPDR Gold vs. Sunstone Hotel Investors |
| Apple vs. Entravision Communications | Apple vs. NORTHEAST UTILITIES | Apple vs. Tower One Wireless | Apple vs. Highlight Communications AG |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |