Correlation Between SPDR DoubleLine and SPDR DoubleLine
Can any of the company-specific risk be diversified away by investing in both SPDR DoubleLine and SPDR DoubleLine 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 SPDR DoubleLine 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 SPDR DoubleLine Total, you can compare the effects of market volatilities on SPDR DoubleLine and SPDR DoubleLine 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 SPDR DoubleLine. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR DoubleLine and SPDR DoubleLine.
Diversification Opportunities for SPDR DoubleLine and SPDR DoubleLine
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SPDR and SPDR is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding SPDR DoubleLine Short and SPDR DoubleLine Total in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR DoubleLine Total 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 SPDR DoubleLine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR DoubleLine Total has no effect on the direction of SPDR DoubleLine i.e., SPDR DoubleLine and SPDR DoubleLine go up and down completely randomly.
Pair Corralation between SPDR DoubleLine and SPDR DoubleLine
Given the investment horizon of 90 days SPDR DoubleLine Short is expected to generate 0.26 times more return on investment than SPDR DoubleLine. However, SPDR DoubleLine Short is 3.81 times less risky than SPDR DoubleLine. It trades about 0.14 of its potential returns per unit of risk. SPDR DoubleLine Total is currently generating about 0.01 per unit of risk. If you would invest 4,324 in SPDR DoubleLine Short on January 25, 2024 and sell it today you would earn a total of 347.00 from holding SPDR DoubleLine Short or generate 8.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR DoubleLine Short vs. SPDR DoubleLine Total
Performance |
| Timeline |
| SPDR DoubleLine Short |
| SPDR DoubleLine Total |
SPDR DoubleLine and SPDR DoubleLine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR DoubleLine and SPDR DoubleLine
The main advantage of trading using opposite SPDR DoubleLine and SPDR DoubleLine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR DoubleLine position performs unexpectedly, SPDR DoubleLine 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 SPDR DoubleLine will offset losses from the drop in SPDR DoubleLine'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 |
| SPDR DoubleLine vs. Fidelity Corporate Bond | SPDR DoubleLine vs. Fidelity Limited Term | SPDR DoubleLine vs. Fidelity High Yield | SPDR DoubleLine vs. Fidelity High Dividend |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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