Correlation Between TD Global and IShares SPTSX
Can any of the company-specific risk be diversified away by investing in both TD Global and IShares SPTSX 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 TD Global and IShares SPTSX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TD Global Technology and iShares SPTSX Capped, you can compare the effects of market volatilities on TD Global and IShares SPTSX 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 TD Global with a short position of IShares SPTSX. Check out your portfolio center. Please also check ongoing floating volatility patterns of TD Global and IShares SPTSX.
Diversification Opportunities for TD Global and IShares SPTSX
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between TEC and IShares is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding TD Global Technology and iShares SPTSX Capped in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares SPTSX Capped and TD Global 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 TD Global Technology are associated (or correlated) with IShares SPTSX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares SPTSX Capped has no effect on the direction of TD Global i.e., TD Global and IShares SPTSX go up and down completely randomly.
Pair Corralation between TD Global and IShares SPTSX
Assuming the 90 days trading horizon TD Global Technology is expected to generate 1.26 times more return on investment than IShares SPTSX. However, TD Global is 1.26 times more volatile than iShares SPTSX Capped. It trades about 0.07 of its potential returns per unit of risk. iShares SPTSX Capped is currently generating about -0.02 per unit of risk. If you would invest 2,468 in TD Global Technology on January 11, 2025 and sell it today you would earn a total of 1,366 from holding TD Global Technology or generate 55.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TD Global Technology vs. iShares SPTSX Capped
Performance |
| Timeline |
| TD Global Technology |
| iShares SPTSX Capped |
TD Global and IShares SPTSX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TD Global and IShares SPTSX
The main advantage of trading using opposite TD Global and IShares SPTSX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TD Global position performs unexpectedly, IShares SPTSX 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 SPTSX will offset losses from the drop in IShares SPTSX's long position.| TD Global vs. iShares Core Equity | TD Global vs. Vanguard All Equity ETF | TD Global vs. iShares SPTSX Capped | TD Global vs. Vanguard Growth Portfolio |
| IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. iShares Canadian Select | IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. BMO Equal Weight |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Stocks Directory Find actively traded stocks across global markets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |