Correlation Between SPDR Series and FibroGen
Can any of the company-specific risk be diversified away by investing in both SPDR Series and FibroGen 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 Series and FibroGen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Series Trust and FibroGen, you can compare the effects of market volatilities on SPDR Series and FibroGen 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 Series with a short position of FibroGen. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Series and FibroGen.
Diversification Opportunities for SPDR Series and FibroGen
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between SPDR and FibroGen is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Series Trust and FibroGen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FibroGen and SPDR Series 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 Series Trust are associated (or correlated) with FibroGen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FibroGen has no effect on the direction of SPDR Series i.e., SPDR Series and FibroGen go up and down completely randomly.
Pair Corralation between SPDR Series and FibroGen
Assuming the 90 days trading horizon SPDR Series Trust is expected to under-perform the FibroGen. But the etf apears to be less risky and, when comparing its historical volatility, SPDR Series Trust is 3.07 times less risky than FibroGen. The etf trades about -0.22 of its potential returns per unit of risk. The FibroGen is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 1,025 in FibroGen on November 27, 2024 and sell it today you would earn a total of 476.00 from holding FibroGen or generate 46.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Series Trust vs. FibroGen
Performance |
| Timeline |
| SPDR Series Trust |
| FibroGen |
SPDR Series and FibroGen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Series and FibroGen
The main advantage of trading using opposite SPDR Series and FibroGen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Series position performs unexpectedly, FibroGen 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 FibroGen will offset losses from the drop in FibroGen's long position.| SPDR Series vs. SPDR Dow Jones | SPDR Series vs. SPDR Gold Trust | SPDR Series vs. SPDR SP 500 | SPDR Series vs. SPDR SP Regional |
| FibroGen vs. FIBRA Storage | FibroGen vs. New Oriental Education | FibroGen vs. Delta Air Lines | FibroGen vs. First Republic Bank |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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