Correlation Between SPDR Kensho and SPDR SP
Can any of the company-specific risk be diversified away by investing in both SPDR Kensho and SPDR SP 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 Kensho and SPDR SP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Kensho New and SPDR SP Kensho, you can compare the effects of market volatilities on SPDR Kensho and SPDR SP 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 Kensho with a short position of SPDR SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Kensho and SPDR SP.
Diversification Opportunities for SPDR Kensho and SPDR SP
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SPDR and SPDR is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Kensho New and SPDR SP Kensho in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SP Kensho and SPDR Kensho 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 Kensho New are associated (or correlated) with SPDR SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SP Kensho has no effect on the direction of SPDR Kensho i.e., SPDR Kensho and SPDR SP go up and down completely randomly.
Pair Corralation between SPDR Kensho and SPDR SP
Given the investment horizon of 90 days SPDR Kensho is expected to generate 1.48 times less return on investment than SPDR SP. In addition to that, SPDR Kensho is 1.2 times more volatile than SPDR SP Kensho. It trades about 0.04 of its total potential returns per unit of risk. SPDR SP Kensho is currently generating about 0.08 per unit of volatility. If you would invest 4,329 in SPDR SP Kensho on October 22, 2024 and sell it today you would earn a total of 1,492 from holding SPDR SP Kensho or generate 34.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Kensho New vs. SPDR SP Kensho
Performance |
| Timeline |
| SPDR Kensho New |
| SPDR SP Kensho |
SPDR Kensho and SPDR SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Kensho and SPDR SP
The main advantage of trading using opposite SPDR Kensho and SPDR SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Kensho position performs unexpectedly, SPDR SP 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 SP will offset losses from the drop in SPDR SP's long position.| SPDR Kensho vs. SPDR Kensho Clean | SPDR Kensho vs. SPDR SP Kensho | SPDR Kensho vs. SPDR SP Kensho | SPDR Kensho vs. SPDR SP Kensho |
| SPDR SP vs. Procure Space ETF | SPDR SP vs. SPDR SP Kensho | SPDR SP vs. SPDR Kensho New | SPDR SP vs. SPDR Kensho Clean |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |