Correlation Between DSJA and Spinnaker ETF

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

By analyzing existing cross correlation between DSJA and Spinnaker ETF Series, you can compare the effects of market volatilities on DSJA and Spinnaker 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 DSJA with a short position of Spinnaker ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of DSJA and Spinnaker ETF.

Diversification Opportunities for DSJA and Spinnaker ETF

-0.59

Correlation Coefficient

DSJA  Spinnaker ETF

Excellent diversification

The 3 months correlation between DSJA and Spinnaker is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding DSJA and Spinnaker ETF Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spinnaker ETF Series and DSJA 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 DSJA are associated (or correlated) with Spinnaker ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spinnaker ETF Series has no effect on the direction of DSJA i.e., DSJA and Spinnaker ETF go up and down completely randomly.

Pair Corralation between DSJA and Spinnaker ETF

If you would invest  1,017  in Spinnaker ETF Series on September 2, 2024 and sell it today you would earn a total of  4.00  from holding Spinnaker ETF Series or generate 0.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

DSJA  vs.  Spinnaker ETF Series

DSJA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DSJA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward-looking indicators, DSJA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Spinnaker ETF Series

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Spinnaker ETF Series are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Spinnaker ETF is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with DSJA and Spinnaker ETF

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

The idea behind DSJA and Spinnaker ETF Series 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.