Correlation Between Snap and CoreShares
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By analyzing existing cross correlation between Snap Inc and CoreShares SP 500, you can compare the effects of market volatilities on Snap and CoreShares 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 Snap with a short position of CoreShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and CoreShares.
Diversification Opportunities for Snap and CoreShares
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Snap and CoreShares is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and CoreShares SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoreShares SP 500 and Snap 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 Snap Inc are associated (or correlated) with CoreShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoreShares SP 500 has no effect on the direction of Snap i.e., Snap and CoreShares go up and down completely randomly.
Pair Corralation between Snap and CoreShares
Given the investment horizon of 90 days Snap Inc is expected to generate 4.13 times more return on investment than CoreShares. However, Snap is 4.13 times more volatile than CoreShares SP 500. It trades about 0.03 of its potential returns per unit of risk. CoreShares SP 500 is currently generating about 0.09 per unit of risk. If you would invest 1,004 in Snap Inc on August 31, 2024 and sell it today you would earn a total of 177.00 from holding Snap Inc or generate 17.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.47% |
| Values | Daily Returns |
Snap Inc vs. CoreShares SP 500
Performance |
| Timeline |
| Snap Inc |
| CoreShares SP 500 |
Snap and CoreShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and CoreShares
The main advantage of trading using opposite Snap and CoreShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, CoreShares 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 CoreShares will offset losses from the drop in CoreShares' long position.The idea behind Snap Inc and CoreShares SP 500 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| CoreShares vs. Europa Metals | CoreShares vs. JSE Limited | CoreShares vs. British American Tobacco | CoreShares vs. Kap Industrial Holdings |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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