Correlation Between SPDR Portfolio and Matthews Emerging
Can any of the company-specific risk be diversified away by investing in both SPDR Portfolio and Matthews Emerging 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 Matthews Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Portfolio Emerging and Matthews Emerging Markets, you can compare the effects of market volatilities on SPDR Portfolio and Matthews Emerging 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 Matthews Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Portfolio and Matthews Emerging.
Diversification Opportunities for SPDR Portfolio and Matthews Emerging
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SPDR and Matthews is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Portfolio Emerging and Matthews Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews Emerging Markets 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 Emerging are associated (or correlated) with Matthews Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews Emerging Markets has no effect on the direction of SPDR Portfolio i.e., SPDR Portfolio and Matthews Emerging go up and down completely randomly.
Pair Corralation between SPDR Portfolio and Matthews Emerging
Given the investment horizon of 90 days SPDR Portfolio Emerging is expected to generate 0.88 times more return on investment than Matthews Emerging. However, SPDR Portfolio Emerging is 1.14 times less risky than Matthews Emerging. It trades about 0.04 of its potential returns per unit of risk. Matthews Emerging Markets is currently generating about 0.0 per unit of risk. If you would invest 3,342 in SPDR Portfolio Emerging on August 27, 2024 and sell it today you would earn a total of 587.00 from holding SPDR Portfolio Emerging or generate 17.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 48.13% |
| Values | Daily Returns |
SPDR Portfolio Emerging vs. Matthews Emerging Markets
Performance |
| Timeline |
| SPDR Portfolio Emerging |
| Matthews Emerging Markets |
SPDR Portfolio and Matthews Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Portfolio and Matthews Emerging
The main advantage of trading using opposite SPDR Portfolio and Matthews Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Portfolio position performs unexpectedly, Matthews Emerging 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 Matthews Emerging will offset losses from the drop in Matthews Emerging's long position.| SPDR Portfolio vs. Invesco PureBeta MSCI | SPDR Portfolio vs. Aquagold International | SPDR Portfolio vs. Morningstar Unconstrained Allocation | SPDR Portfolio vs. High Yield Municipal Fund |
| Matthews Emerging vs. Matthews China Discovery | Matthews Emerging vs. Neuberger Berman ETF | Matthews Emerging vs. Fidelity Small Mid Cap | Matthews Emerging vs. Professionally Managed Portfolios |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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