Correlation Between SPDR Barclays and VictoryShares USAA
Can any of the company-specific risk be diversified away by investing in both SPDR Barclays and VictoryShares USAA 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 Barclays and VictoryShares USAA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Barclays Intermediate and VictoryShares USAA Core, you can compare the effects of market volatilities on SPDR Barclays and VictoryShares USAA 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 Barclays with a short position of VictoryShares USAA. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Barclays and VictoryShares USAA.
Diversification Opportunities for SPDR Barclays and VictoryShares USAA
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SPDR and VictoryShares is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Barclays Intermediate and VictoryShares USAA Core in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VictoryShares USAA Core and SPDR Barclays 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 Barclays Intermediate are associated (or correlated) with VictoryShares USAA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VictoryShares USAA Core has no effect on the direction of SPDR Barclays i.e., SPDR Barclays and VictoryShares USAA go up and down completely randomly.
Pair Corralation between SPDR Barclays and VictoryShares USAA
Given the investment horizon of 90 days SPDR Barclays Intermediate is expected to generate 0.73 times more return on investment than VictoryShares USAA. However, SPDR Barclays Intermediate is 1.37 times less risky than VictoryShares USAA. It trades about -0.18 of its potential returns per unit of risk. VictoryShares USAA Core is currently generating about -0.23 per unit of risk. If you would invest 3,250 in SPDR Barclays Intermediate on January 26, 2024 and sell it today you would lose (35.00) from holding SPDR Barclays Intermediate or give up 1.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Barclays Intermediate vs. VictoryShares USAA Core
Performance |
| Timeline |
| SPDR Barclays Interm |
| VictoryShares USAA Core |
SPDR Barclays and VictoryShares USAA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Barclays and VictoryShares USAA
The main advantage of trading using opposite SPDR Barclays and VictoryShares USAA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Barclays position performs unexpectedly, VictoryShares USAA 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 VictoryShares USAA will offset losses from the drop in VictoryShares USAA's long position.| SPDR Barclays vs. iShares iBoxx High | SPDR Barclays vs. iShares 1 3 Year | SPDR Barclays vs. iShares TIPS Bond | SPDR Barclays vs. iShares 7 10 Year |
| VictoryShares USAA vs. Vanguard Total International | VictoryShares USAA vs. Vanguard Total International | VictoryShares USAA vs. Vanguard Total Stock | VictoryShares USAA vs. Vanguard Real Estate |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |