Correlation Between SPDR SP and Invesco Electric
Can any of the company-specific risk be diversified away by investing in both SPDR SP and Invesco Electric 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 SP and Invesco Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR SP 500 and Invesco Electric Vehicle, you can compare the effects of market volatilities on SPDR SP and Invesco Electric 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 SP with a short position of Invesco Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR SP and Invesco Electric.
Diversification Opportunities for SPDR SP and Invesco Electric
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SPDR and Invesco is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding SPDR SP 500 and Invesco Electric Vehicle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Electric Vehicle and SPDR SP 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 SP 500 are associated (or correlated) with Invesco Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Electric Vehicle has no effect on the direction of SPDR SP i.e., SPDR SP and Invesco Electric go up and down completely randomly.
Pair Corralation between SPDR SP and Invesco Electric
Considering the 90-day investment horizon SPDR SP 500 is expected to generate 0.66 times more return on investment than Invesco Electric. However, SPDR SP 500 is 1.51 times less risky than Invesco Electric. It trades about 0.12 of its potential returns per unit of risk. Invesco Electric Vehicle is currently generating about -0.06 per unit of risk. If you would invest 38,202 in SPDR SP 500 on August 30, 2024 and sell it today you would earn a total of 21,681 from holding SPDR SP 500 or generate 56.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR SP 500 vs. Invesco Electric Vehicle
Performance |
| Timeline |
| SPDR SP 500 |
| Invesco Electric Vehicle |
SPDR SP and Invesco Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR SP and Invesco Electric
The main advantage of trading using opposite SPDR SP and Invesco Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR SP position performs unexpectedly, Invesco Electric 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 Invesco Electric will offset losses from the drop in Invesco Electric's long position.| SPDR SP vs. FT Vest Equity | SPDR SP vs. Northern Lights | SPDR SP vs. Dimensional International High | SPDR SP vs. First Trust Exchange Traded |
| Invesco Electric vs. iShares Silver Trust | Invesco Electric vs. VanEck Gold Miners | Invesco Electric vs. SPDR SP 500 | Invesco Electric vs. United States Oil |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |