Correlation Between SPDR Barclays and IShares Short
Can any of the company-specific risk be diversified away by investing in both SPDR Barclays and IShares Short 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 IShares Short 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 iShares Short Treasury, you can compare the effects of market volatilities on SPDR Barclays and IShares Short 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 IShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Barclays and IShares Short.
Diversification Opportunities for SPDR Barclays and IShares Short
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SPDR and IShares is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Barclays Short and iShares Short Treasury in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Short Treasury 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 IShares Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Short Treasury has no effect on the direction of SPDR Barclays i.e., SPDR Barclays and IShares Short go up and down completely randomly.
Pair Corralation between SPDR Barclays and IShares Short
Given the investment horizon of 90 days SPDR Barclays Short is expected to generate 5.98 times more return on investment than IShares Short. However, SPDR Barclays is 5.98 times more volatile than iShares Short Treasury. It trades about 0.29 of its potential returns per unit of risk. iShares Short Treasury is currently generating about 1.29 per unit of risk. If you would invest 2,891 in SPDR Barclays Short on September 12, 2024 and sell it today you would earn a total of 15.00 from holding SPDR Barclays Short or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Barclays Short vs. iShares Short Treasury
Performance |
| Timeline |
| SPDR Barclays Short |
| iShares Short Treasury |
SPDR Barclays and IShares Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Barclays and IShares Short
The main advantage of trading using opposite SPDR Barclays and IShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Barclays position performs unexpectedly, IShares Short 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 IShares Short will offset losses from the drop in IShares Short'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 |
| IShares Short vs. iShares Treasury Floating | IShares Short vs. SPDR Bloomberg Investment | IShares Short vs. iShares 0 3 Month | IShares Short vs. SPDR Barclays Short |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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