Correlation Between SPDR Portfolio and Exponential ETFs

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

By analyzing existing cross correlation between SPDR Portfolio Aggregate and Exponential ETFs, you can compare the effects of market volatilities on SPDR Portfolio and Exponential ETFs 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 Portfolio with a short position of Exponential ETFs. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Portfolio and Exponential ETFs.

Diversification Opportunities for SPDR Portfolio and Exponential ETFs

0.0

Correlation Coefficient

SPDR Portfolio  Exponential ETFs

Pay attention - limited upside

The 3 months correlation between SPDR and Exponential is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Portfolio Aggregate and Exponential ETFs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exponential ETFs and SPDR Portfolio 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 Portfolio Aggregate are associated (or correlated) with Exponential ETFs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exponential ETFs has no effect on the direction of SPDR Portfolio i.e., SPDR Portfolio and Exponential ETFs go up and down completely randomly.

Pair Corralation between SPDR Portfolio and Exponential ETFs

If you would invest (100.00) in Exponential ETFs on September 16, 2024 and sell it today you would earn a total of  100.00  from holding Exponential ETFs or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

SPDR Portfolio Aggregate  vs.  Exponential ETFs

SPDR Portfolio Aggregate

Risk-Adjusted Performance

0 of 100

Very Weak

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

Exponential ETFs

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Exponential ETFs has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Exponential ETFs is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with SPDR Portfolio and Exponential ETFs

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

The idea behind SPDR Portfolio Aggregate and Exponential ETFs 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.

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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .