Correlation Between SPDR DoubleLine and IShares Intermediate
Can any of the company-specific risk be diversified away by investing in both SPDR DoubleLine and IShares Intermediate 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 DoubleLine and IShares Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR DoubleLine Short and iShares Intermediate GovernmentCredit, you can compare the effects of market volatilities on SPDR DoubleLine and IShares Intermediate 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 DoubleLine with a short position of IShares Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR DoubleLine and IShares Intermediate.
Diversification Opportunities for SPDR DoubleLine and IShares Intermediate
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between SPDR and IShares is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding SPDR DoubleLine Short and iShares Intermediate Governmen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Intermediate and SPDR DoubleLine 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 DoubleLine Short are associated (or correlated) with IShares Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Intermediate has no effect on the direction of SPDR DoubleLine i.e., SPDR DoubleLine and IShares Intermediate go up and down completely randomly.
Pair Corralation between SPDR DoubleLine and IShares Intermediate
Given the investment horizon of 90 days SPDR DoubleLine Short is expected to generate 0.39 times more return on investment than IShares Intermediate. However, SPDR DoubleLine Short is 2.57 times less risky than IShares Intermediate. It trades about 0.21 of its potential returns per unit of risk. iShares Intermediate GovernmentCredit is currently generating about 0.04 per unit of risk. If you would invest 4,486 in SPDR DoubleLine Short on January 24, 2024 and sell it today you would earn a total of 182.00 from holding SPDR DoubleLine Short or generate 4.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR DoubleLine Short vs. iShares Intermediate Governmen
Performance |
| Timeline |
| SPDR DoubleLine Short |
| iShares Intermediate |
SPDR DoubleLine and IShares Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR DoubleLine and IShares Intermediate
The main advantage of trading using opposite SPDR DoubleLine and IShares Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR DoubleLine position performs unexpectedly, IShares Intermediate 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 IShares Intermediate will offset losses from the drop in IShares Intermediate's long position.| SPDR DoubleLine vs. SPDR DoubleLine Emerging | SPDR DoubleLine vs. SPDR SSgA Ultra | SPDR DoubleLine vs. SPDR Bloomberg 1 10 | SPDR DoubleLine vs. SPDR DoubleLine Total |
| IShares Intermediate vs. SPDR DoubleLine Emerging | IShares Intermediate vs. SPDR SSgA Ultra | IShares Intermediate vs. SPDR Bloomberg 1 10 | IShares Intermediate vs. SPDR DoubleLine Total |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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