Correlation Between SPDR Barclays and Xtrackers
Can any of the company-specific risk be diversified away by investing in both SPDR Barclays and Xtrackers 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 Barclays and Xtrackers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Barclays Intermediate and Xtrackers 0 1 Year, you can compare the effects of market volatilities on SPDR Barclays and Xtrackers 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 Barclays with a short position of Xtrackers. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Barclays and Xtrackers.
Diversification Opportunities for SPDR Barclays and Xtrackers
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SPDR and Xtrackers is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Barclays Intermediate and Xtrackers 0 1 Year in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers 0 1 and SPDR Barclays 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 Barclays Intermediate are associated (or correlated) with Xtrackers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers 0 1 has no effect on the direction of SPDR Barclays i.e., SPDR Barclays and Xtrackers go up and down completely randomly.
Pair Corralation between SPDR Barclays and Xtrackers
Given the investment horizon of 90 days SPDR Barclays is expected to generate 2.49 times less return on investment than Xtrackers. In addition to that, SPDR Barclays is 10.67 times more volatile than Xtrackers 0 1 Year. It trades about 0.03 of its total potential returns per unit of risk. Xtrackers 0 1 Year is currently generating about 0.78 per unit of volatility. If you would invest 3,001 in Xtrackers 0 1 Year on September 2, 2024 and sell it today you would earn a total of 18.00 from holding Xtrackers 0 1 Year or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 59.38% |
| Values | Daily Returns |
SPDR Barclays Intermediate vs. Xtrackers 0 1 Year
Performance |
| Timeline |
| SPDR Barclays Interm |
| Xtrackers 0 1 |
SPDR Barclays and Xtrackers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Barclays and Xtrackers
The main advantage of trading using opposite SPDR Barclays and Xtrackers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Barclays position performs unexpectedly, Xtrackers 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 Xtrackers will offset losses from the drop in Xtrackers' long position.| SPDR Barclays vs. SPDR Barclays Short | SPDR Barclays vs. SPDR Bloomberg Emerging | SPDR Barclays vs. SPDR Barclays Long | SPDR Barclays vs. SPDR Barclays Short |
| Xtrackers vs. Global X Funds | Xtrackers vs. US Treasury 12 | Xtrackers vs. Tidal Trust II | Xtrackers vs. Franklin Liberty Treasury |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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