Correlation Between SPDR Barclays and Morgan Stanley
Can any of the company-specific risk be diversified away by investing in both SPDR Barclays and Morgan Stanley 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 Morgan Stanley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Barclays Short and Morgan Stanley ETF, you can compare the effects of market volatilities on SPDR Barclays and Morgan Stanley 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 Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Barclays and Morgan Stanley.
Diversification Opportunities for SPDR Barclays and Morgan Stanley
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPDR and Morgan is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Barclays Short and Morgan Stanley ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley ETF 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 Short are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley ETF has no effect on the direction of SPDR Barclays i.e., SPDR Barclays and Morgan Stanley go up and down completely randomly.
Pair Corralation between SPDR Barclays and Morgan Stanley
Given the investment horizon of 90 days SPDR Barclays is expected to generate 1.61 times less return on investment than Morgan Stanley. In addition to that, SPDR Barclays is 2.92 times more volatile than Morgan Stanley ETF. It trades about 0.11 of its total potential returns per unit of risk. Morgan Stanley ETF is currently generating about 0.52 per unit of volatility. If you would invest 4,708 in Morgan Stanley ETF on September 14, 2024 and sell it today you would earn a total of 370.00 from holding Morgan Stanley ETF or generate 7.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 58.79% |
| Values | Daily Returns |
SPDR Barclays Short vs. Morgan Stanley ETF
Performance |
| Timeline |
| SPDR Barclays Short |
| Morgan Stanley ETF |
SPDR Barclays and Morgan Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Barclays and Morgan Stanley
The main advantage of trading using opposite SPDR Barclays and Morgan Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Barclays position performs unexpectedly, Morgan Stanley 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 Morgan Stanley will offset losses from the drop in Morgan Stanley's long position.| SPDR Barclays vs. SPDR Barclays Long | SPDR Barclays vs. SPDR Portfolio Intermediate | SPDR Barclays vs. SPDR Barclays Short | SPDR Barclays vs. SPDR Barclays Intermediate |
| Morgan Stanley vs. iShares Treasury Floating | Morgan Stanley vs. SPDR Bloomberg Investment | Morgan Stanley vs. SPDR Barclays Short | Morgan Stanley vs. SPDR Bloomberg 1 3 |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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