Correlation Between SPDR Bloomberg and Series Portfolios

Can any of the company-specific risk be diversified away by investing in both SPDR Bloomberg and Series Portfolios 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 Bloomberg and Series Portfolios into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SPDR Bloomberg 1 3 and Series Portfolios Trust, you can compare the effects of market volatilities on SPDR Bloomberg and Series Portfolios 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 Bloomberg with a short position of Series Portfolios. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Bloomberg and Series Portfolios.

Diversification Opportunities for SPDR Bloomberg and Series Portfolios

0.97

Correlation Coefficient

SPDR Bloomberg  Series Portfolios

Almost no diversification

The 3 months correlation between SPDR and Series is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Bloomberg 1 3 and Series Portfolios Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Series Portfolios Trust and SPDR Bloomberg 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 Bloomberg 1 3 are associated (or correlated) with Series Portfolios. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Series Portfolios Trust has no effect on the direction of SPDR Bloomberg i.e., SPDR Bloomberg and Series Portfolios go up and down completely randomly.

Pair Corralation between SPDR Bloomberg and Series Portfolios

Considering the 90-day investment horizon SPDR Bloomberg is expected to generate 1.36 times less return on investment than Series Portfolios. But when comparing it to its historical volatility, SPDR Bloomberg 1 3 is 4.7 times less risky than Series Portfolios. It trades about 1.15 of its potential returns per unit of risk. Series Portfolios Trust is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest  2,517  in Series Portfolios Trust on August 30, 2024 and sell it today you would earn a total of  40.00  from holding Series Portfolios Trust or generate 1.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

SPDR Bloomberg 1 3  vs.  Series Portfolios Trust

SPDR Bloomberg 1

Risk-Adjusted Performance

90 of 100

Market Crasher

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR Bloomberg 1 3 are ranked lower than 90 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward indicators, SPDR Bloomberg is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Series Portfolios Trust

Risk-Adjusted Performance

26 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Series Portfolios Trust are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Series Portfolios is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SPDR Bloomberg and Series Portfolios

The main advantage of trading using opposite SPDR Bloomberg and Series Portfolios positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Bloomberg position performs unexpectedly, Series Portfolios 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 Series Portfolios will offset losses from the drop in Series Portfolios' long position.

The idea behind SPDR Bloomberg 1 3 and Series Portfolios Trust pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.