Correlation Between Xtrackers USD and Harbor ETF
Can any of the company-specific risk be diversified away by investing in both Xtrackers USD and Harbor ETF 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 Xtrackers USD and Harbor ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers USD High and Harbor ETF Trust, you can compare the effects of market volatilities on Xtrackers USD and Harbor ETF 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 Xtrackers USD with a short position of Harbor ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers USD and Harbor ETF.
Diversification Opportunities for Xtrackers USD and Harbor ETF
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xtrackers and Harbor is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers USD High and Harbor ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor ETF Trust and Xtrackers USD 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 Xtrackers USD High are associated (or correlated) with Harbor ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor ETF Trust has no effect on the direction of Xtrackers USD i.e., Xtrackers USD and Harbor ETF go up and down completely randomly.
Pair Corralation between Xtrackers USD and Harbor ETF
Given the investment horizon of 90 days Xtrackers USD is expected to generate 1.03 times less return on investment than Harbor ETF. But when comparing it to its historical volatility, Xtrackers USD High is 1.08 times less risky than Harbor ETF. It trades about 0.14 of its potential returns per unit of risk. Harbor ETF Trust is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 4,286 in Harbor ETF Trust on August 29, 2024 and sell it today you would earn a total of 342.00 from holding Harbor ETF Trust or generate 7.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers USD High vs. Harbor ETF Trust
Performance |
| Timeline |
| Xtrackers USD High |
| Harbor ETF Trust |
Xtrackers USD and Harbor ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers USD and Harbor ETF
The main advantage of trading using opposite Xtrackers USD and Harbor ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers USD position performs unexpectedly, Harbor ETF 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 Harbor ETF will offset losses from the drop in Harbor ETF's long position.| Xtrackers USD vs. SPDR Bloomberg Emerging | Xtrackers USD vs. iShares Broad USD | Xtrackers USD vs. SPDR Barclays Intermediate | Xtrackers USD vs. Schwab Intermediate Term Treasury |
| Harbor ETF vs. Harbor Scientific Alpha | Harbor ETF vs. Xtrackers Short Duration | Harbor ETF vs. Dimensional ETF Trust | Harbor ETF vs. Pacer Pacific Asset |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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