Correlation Between SP Global and Global Brokerage
Can any of the company-specific risk be diversified away by investing in both SP Global and Global Brokerage 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 Global and Global Brokerage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SP Global and Global Brokerage, you can compare the effects of market volatilities on SP Global and Global Brokerage 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 Global with a short position of Global Brokerage. Check out your portfolio center. Please also check ongoing floating volatility patterns of SP Global and Global Brokerage.
Diversification Opportunities for SP Global and Global Brokerage
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SPGI and Global is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SP Global and Global Brokerage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Brokerage and SP Global 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 Global are associated (or correlated) with Global Brokerage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Brokerage has no effect on the direction of SP Global i.e., SP Global and Global Brokerage go up and down completely randomly.
Pair Corralation between SP Global and Global Brokerage
If you would invest 43,165 in SP Global on September 3, 2024 and sell it today you would earn a total of 9,086 from holding SP Global or generate 21.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.6% |
| Values | Daily Returns |
SP Global vs. Global Brokerage
Performance |
| Timeline |
| SP Global |
| Global Brokerage |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
SP Global and Global Brokerage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SP Global and Global Brokerage
The main advantage of trading using opposite SP Global and Global Brokerage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SP Global position performs unexpectedly, Global Brokerage 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 Global Brokerage will offset losses from the drop in Global Brokerage's long position.| SP Global vs. MSCI Inc | SP Global vs. Nasdaq Inc | SP Global vs. Intercontinental Exchange | SP Global vs. CME Group |
| Global Brokerage vs. SP Global | Global Brokerage vs. Moodys | Global Brokerage vs. Nasdaq Inc | Global Brokerage vs. CME Group |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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