Correlation Between SPDR Portfolio and WBI Power
Can any of the company-specific risk be diversified away by investing in both SPDR Portfolio and WBI Power 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 Portfolio and WBI Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Portfolio Aggregate and WBI Power Factor, you can compare the effects of market volatilities on SPDR Portfolio and WBI Power 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 Portfolio with a short position of WBI Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Portfolio and WBI Power.
Diversification Opportunities for SPDR Portfolio and WBI Power
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPDR and WBI is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Portfolio Aggregate and WBI Power Factor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WBI Power Factor and SPDR Portfolio 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 Portfolio Aggregate are associated (or correlated) with WBI Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WBI Power Factor has no effect on the direction of SPDR Portfolio i.e., SPDR Portfolio and WBI Power go up and down completely randomly.
Pair Corralation between SPDR Portfolio and WBI Power
Given the investment horizon of 90 days SPDR Portfolio Aggregate is expected to under-perform the WBI Power. But the etf apears to be less risky and, when comparing its historical volatility, SPDR Portfolio Aggregate is 2.74 times less risky than WBI Power. The etf trades about -0.09 of its potential returns per unit of risk. The WBI Power Factor is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,999 in WBI Power Factor on September 12, 2024 and sell it today you would earn a total of 144.00 from holding WBI Power Factor or generate 4.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Portfolio Aggregate vs. WBI Power Factor
Performance |
| Timeline |
| SPDR Portfolio Aggregate |
| WBI Power Factor |
SPDR Portfolio and WBI Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Portfolio and WBI Power
The main advantage of trading using opposite SPDR Portfolio and WBI Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Portfolio position performs unexpectedly, WBI Power 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 WBI Power will offset losses from the drop in WBI Power's long position.| SPDR Portfolio vs. SPDR SP World | SPDR Portfolio vs. SPDR Barclays Intermediate | SPDR Portfolio vs. SPDR Portfolio SP | SPDR Portfolio vs. SPDR Portfolio Emerging |
| WBI Power vs. Freedom Day Dividend | WBI Power vs. Franklin Templeton ETF | WBI Power vs. iShares MSCI China | WBI Power vs. Tidal Trust II |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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