Correlation Between Sp 500 and Shelton Tactical
Can any of the company-specific risk be diversified away by investing in both Sp 500 and Shelton Tactical 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 Sp 500 and Shelton Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sp 500 Index and Shelton Tactical Credit, you can compare the effects of market volatilities on Sp 500 and Shelton Tactical 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 Sp 500 with a short position of Shelton Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sp 500 and Shelton Tactical.
Diversification Opportunities for Sp 500 and Shelton Tactical
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SPFIX and Shelton is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sp 500 Index and Shelton Tactical Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shelton Tactical Credit and Sp 500 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 Sp 500 Index are associated (or correlated) with Shelton Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shelton Tactical Credit has no effect on the direction of Sp 500 i.e., Sp 500 and Shelton Tactical go up and down completely randomly.
Pair Corralation between Sp 500 and Shelton Tactical
Assuming the 90 days horizon Sp 500 Index is expected to generate 4.34 times more return on investment than Shelton Tactical. However, Sp 500 is 4.34 times more volatile than Shelton Tactical Credit. It trades about 0.03 of its potential returns per unit of risk. Shelton Tactical Credit is currently generating about 0.12 per unit of risk. If you would invest 7,161 in Sp 500 Index on September 1, 2024 and sell it today you would earn a total of 434.00 from holding Sp 500 Index or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sp 500 Index vs. Shelton Tactical Credit
Performance |
| Timeline |
| Sp 500 Index |
| Shelton Tactical Credit |
Sp 500 and Shelton Tactical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sp 500 and Shelton Tactical
The main advantage of trading using opposite Sp 500 and Shelton Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sp 500 position performs unexpectedly, Shelton Tactical 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 Shelton Tactical will offset losses from the drop in Shelton Tactical's long position.| Sp 500 vs. Sp Midcap Index | Sp 500 vs. Sp Smallcap Index | Sp 500 vs. Deutsche Equity 500 | Sp 500 vs. Dreyfus Institutional Sp |
| Shelton Tactical vs. Shelton Emerging Markets | Shelton Tactical vs. Shelton Emerging Markets | Shelton Tactical vs. California Tax Free Income | Shelton Tactical vs. Shelton Funds |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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