Correlation Between SPDR Portfolio and Virtus ETF
Can any of the company-specific risk be diversified away by investing in both SPDR Portfolio and Virtus ETF 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 Portfolio and Virtus ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Portfolio SP and Virtus ETF Trust, you can compare the effects of market volatilities on SPDR Portfolio and Virtus ETF 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 Portfolio with a short position of Virtus ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Portfolio and Virtus ETF.
Diversification Opportunities for SPDR Portfolio and Virtus ETF
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SPDR and Virtus is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Portfolio SP and Virtus ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus ETF Trust and SPDR Portfolio 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 Portfolio SP are associated (or correlated) with Virtus ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus ETF Trust has no effect on the direction of SPDR Portfolio i.e., SPDR Portfolio and Virtus ETF go up and down completely randomly.
Pair Corralation between SPDR Portfolio and Virtus ETF
Given the investment horizon of 90 days SPDR Portfolio is expected to generate 2.78 times less return on investment than Virtus ETF. In addition to that, SPDR Portfolio is 1.07 times more volatile than Virtus ETF Trust. It trades about 0.07 of its total potential returns per unit of risk. Virtus ETF Trust is currently generating about 0.2 per unit of volatility. If you would invest 3,758 in Virtus ETF Trust on August 23, 2024 and sell it today you would earn a total of 186.00 from holding Virtus ETF Trust or generate 4.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Portfolio SP vs. Virtus ETF Trust
Performance |
| Timeline |
| SPDR Portfolio SP |
| Virtus ETF Trust |
SPDR Portfolio and Virtus ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Portfolio and Virtus ETF
The main advantage of trading using opposite SPDR Portfolio and Virtus ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Portfolio position performs unexpectedly, Virtus ETF 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 Virtus ETF will offset losses from the drop in Virtus ETF's long position.| SPDR Portfolio vs. Vanguard Russell 1000 | SPDR Portfolio vs. Vanguard Russell 2000 | SPDR Portfolio vs. Vanguard Mega Cap | SPDR Portfolio vs. Vanguard Russell 1000 |
| Virtus ETF vs. iShares Small Cap | Virtus ETF vs. Pacer Cash Cows | Virtus ETF vs. GXO Logistics | Virtus ETF vs. ProShares Pet Care |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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