Correlation Between SPTSX Dividend and Invesco FTSE
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By analyzing existing cross correlation between SPTSX Dividend Aristocrats and Invesco FTSE RAFI, you can compare the effects of market volatilities on SPTSX Dividend and Invesco FTSE 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 SPTSX Dividend with a short position of Invesco FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPTSX Dividend and Invesco FTSE.
Diversification Opportunities for SPTSX Dividend and Invesco FTSE
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SPTSX and Invesco is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding SPTSX Dividend Aristocrats and Invesco FTSE RAFI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco FTSE RAFI and SPTSX Dividend 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 SPTSX Dividend Aristocrats are associated (or correlated) with Invesco FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco FTSE RAFI has no effect on the direction of SPTSX Dividend i.e., SPTSX Dividend and Invesco FTSE go up and down completely randomly.
Pair Corralation between SPTSX Dividend and Invesco FTSE
Assuming the 90 days trading horizon SPTSX Dividend is expected to generate 3.47 times less return on investment than Invesco FTSE. But when comparing it to its historical volatility, SPTSX Dividend Aristocrats is 2.99 times less risky than Invesco FTSE. It trades about 0.15 of its potential returns per unit of risk. Invesco FTSE RAFI is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 3,494 in Invesco FTSE RAFI on August 29, 2024 and sell it today you would earn a total of 183.00 from holding Invesco FTSE RAFI or generate 5.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPTSX Dividend Aristocrats vs. Invesco FTSE RAFI
Performance |
| Timeline |
SPTSX Dividend and Invesco FTSE Volatility Contrast
Predicted Return Density |
| Returns |
SPTSX Dividend Aristocrats
Pair trading matchups for SPTSX Dividend
Invesco FTSE RAFI
Pair trading matchups for Invesco FTSE
Pair Trading with SPTSX Dividend and Invesco FTSE
The main advantage of trading using opposite SPTSX Dividend and Invesco FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPTSX Dividend position performs unexpectedly, Invesco FTSE 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 Invesco FTSE will offset losses from the drop in Invesco FTSE's long position.| SPTSX Dividend vs. Thunderbird Entertainment Group | SPTSX Dividend vs. Firan Technology Group | SPTSX Dividend vs. Computer Modelling Group | SPTSX Dividend vs. Northstar Clean Technologies |
| Invesco FTSE vs. Invesco FTSE RAFI | Invesco FTSE vs. Invesco 1 3 Year | Invesco FTSE vs. iShares SP Mid Cap |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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