Correlation Between SPDR Series and Promotora
Can any of the company-specific risk be diversified away by investing in both SPDR Series and Promotora 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 Series and Promotora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Series Trust and Promotora y Operadora, you can compare the effects of market volatilities on SPDR Series and Promotora 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 Series with a short position of Promotora. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Series and Promotora.
Diversification Opportunities for SPDR Series and Promotora
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SPDR and Promotora is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Series Trust and Promotora y Operadora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Promotora y Operadora and SPDR Series 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 Series Trust are associated (or correlated) with Promotora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Promotora y Operadora has no effect on the direction of SPDR Series i.e., SPDR Series and Promotora go up and down completely randomly.
Pair Corralation between SPDR Series and Promotora
Assuming the 90 days trading horizon SPDR Series Trust is expected to generate 0.45 times more return on investment than Promotora. However, SPDR Series Trust is 2.23 times less risky than Promotora. It trades about 0.14 of its potential returns per unit of risk. Promotora y Operadora is currently generating about 0.04 per unit of risk. If you would invest 150,611 in SPDR Series Trust on September 3, 2024 and sell it today you would earn a total of 49,539 from holding SPDR Series Trust or generate 32.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Series Trust vs. Promotora y Operadora
Performance |
| Timeline |
| SPDR Series Trust |
| Promotora y Operadora |
SPDR Series and Promotora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Series and Promotora
The main advantage of trading using opposite SPDR Series and Promotora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Series position performs unexpectedly, Promotora 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 Promotora will offset losses from the drop in Promotora's long position.| SPDR Series vs. SPDR Dow Jones | SPDR Series vs. SPDR Gold Trust | SPDR Series vs. SPDR SP 500 | SPDR Series vs. SPDR Series Trust |
| Promotora vs. Gruma SAB de | Promotora vs. Grupo Aeroportuario del | Promotora vs. Grupo Aeroportuario del | Promotora vs. Grupo Aeroportuario del |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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