Correlation Between SPDR Galaxy and Managed Account
Can any of the company-specific risk be diversified away by investing in both SPDR Galaxy and Managed Account 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 Galaxy and Managed Account into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Galaxy Hedged and Managed Account Series, you can compare the effects of market volatilities on SPDR Galaxy and Managed Account 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 Galaxy with a short position of Managed Account. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Galaxy and Managed Account.
Diversification Opportunities for SPDR Galaxy and Managed Account
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SPDR and Managed is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Galaxy Hedged and Managed Account Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Managed Account Series and SPDR Galaxy 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 Galaxy Hedged are associated (or correlated) with Managed Account. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Managed Account Series has no effect on the direction of SPDR Galaxy i.e., SPDR Galaxy and Managed Account go up and down completely randomly.
Pair Corralation between SPDR Galaxy and Managed Account
Given the investment horizon of 90 days SPDR Galaxy Hedged is expected to generate 22.0 times more return on investment than Managed Account. However, SPDR Galaxy is 22.0 times more volatile than Managed Account Series. It trades about 0.26 of its potential returns per unit of risk. Managed Account Series is currently generating about 0.15 per unit of risk. If you would invest 3,040 in SPDR Galaxy Hedged on September 5, 2024 and sell it today you would earn a total of 674.00 from holding SPDR Galaxy Hedged or generate 22.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Galaxy Hedged vs. Managed Account Series
Performance |
| Timeline |
| SPDR Galaxy Hedged |
| Managed Account Series |
SPDR Galaxy and Managed Account Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Galaxy and Managed Account
The main advantage of trading using opposite SPDR Galaxy and Managed Account positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Galaxy position performs unexpectedly, Managed Account 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 Managed Account will offset losses from the drop in Managed Account's long position.| SPDR Galaxy vs. iShares Dividend and | SPDR Galaxy vs. Martin Currie Sustainable | SPDR Galaxy vs. VictoryShares THB Mid | SPDR Galaxy vs. Mast Global Battery |
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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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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