Correlation Between SPDR DoubleLine and Federated Hermes
Can any of the company-specific risk be diversified away by investing in both SPDR DoubleLine and Federated Hermes 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 DoubleLine and Federated Hermes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR DoubleLine Total and Federated Hermes ETF, you can compare the effects of market volatilities on SPDR DoubleLine and Federated Hermes 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 DoubleLine with a short position of Federated Hermes. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR DoubleLine and Federated Hermes.
Diversification Opportunities for SPDR DoubleLine and Federated Hermes
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between SPDR and Federated is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding SPDR DoubleLine Total and Federated Hermes ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Hermes ETF and SPDR DoubleLine 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 DoubleLine Total are associated (or correlated) with Federated Hermes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Hermes ETF has no effect on the direction of SPDR DoubleLine i.e., SPDR DoubleLine and Federated Hermes go up and down completely randomly.
Pair Corralation between SPDR DoubleLine and Federated Hermes
Given the investment horizon of 90 days SPDR DoubleLine Total is expected to generate 1.01 times more return on investment than Federated Hermes. However, SPDR DoubleLine is 1.01 times more volatile than Federated Hermes ETF. It trades about 0.11 of its potential returns per unit of risk. Federated Hermes ETF is currently generating about 0.1 per unit of risk. If you would invest 3,846 in SPDR DoubleLine Total on August 29, 2024 and sell it today you would earn a total of 171.00 from holding SPDR DoubleLine Total or generate 4.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR DoubleLine Total vs. Federated Hermes ETF
Performance |
| Timeline |
| SPDR DoubleLine Total |
| Federated Hermes ETF |
SPDR DoubleLine and Federated Hermes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR DoubleLine and Federated Hermes
The main advantage of trading using opposite SPDR DoubleLine and Federated Hermes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR DoubleLine position performs unexpectedly, Federated Hermes 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 Federated Hermes will offset losses from the drop in Federated Hermes' long position.| SPDR DoubleLine vs. PIMCO Active Bond | SPDR DoubleLine vs. SPDR Blackstone Senior | SPDR DoubleLine vs. SPDR Barclays Intermediate | SPDR DoubleLine vs. SPDR Bloomberg Investment |
| Federated Hermes vs. Valued Advisers Trust | Federated Hermes vs. Columbia Diversified Fixed | Federated Hermes vs. Principal Exchange Traded Funds | Federated Hermes vs. Doubleline Etf Trust |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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