Correlation Between Intel and SPDR Dow
Can any of the company-specific risk be diversified away by investing in both Intel and SPDR Dow 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 Intel and SPDR Dow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and SPDR Dow Jones, you can compare the effects of market volatilities on Intel and SPDR Dow 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 Intel with a short position of SPDR Dow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and SPDR Dow.
Diversification Opportunities for Intel and SPDR Dow
Excellent diversification
The 3 months correlation between Intel and SPDR is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Intel and SPDR Dow Jones in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Dow Jones and Intel 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 Intel are associated (or correlated) with SPDR Dow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Dow Jones has no effect on the direction of Intel i.e., Intel and SPDR Dow go up and down completely randomly.
Pair Corralation between Intel and SPDR Dow
Given the investment horizon of 90 days Intel is expected to generate 4.14 times more return on investment than SPDR Dow. However, Intel is 4.14 times more volatile than SPDR Dow Jones. It trades about 0.16 of its potential returns per unit of risk. SPDR Dow Jones is currently generating about -0.36 per unit of risk. If you would invest 2,198 in Intel on August 24, 2024 and sell it today you would earn a total of 246.00 from holding Intel or generate 11.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intel vs. SPDR Dow Jones
Performance |
| Timeline |
| Intel |
| SPDR Dow Jones |
Intel and SPDR Dow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and SPDR Dow
The main advantage of trading using opposite Intel and SPDR Dow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, SPDR Dow 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 SPDR Dow will offset losses from the drop in SPDR Dow's long position.| Intel vs. NVIDIA | Intel vs. Taiwan Semiconductor Manufacturing | Intel vs. Marvell Technology Group | Intel vs. Micron Technology |
| SPDR Dow vs. SPDR Dow Jones | SPDR Dow vs. SPDR Dow Jones | SPDR Dow vs. SPDR SP International | SPDR Dow vs. iShares Cohen Steers |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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