Correlation Between VNET Group and SPDR SP
Can any of the company-specific risk be diversified away by investing in both VNET Group and SPDR SP 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 VNET Group and SPDR SP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VNET Group DRC and SPDR SP Dividend, you can compare the effects of market volatilities on VNET Group and SPDR SP 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 VNET Group with a short position of SPDR SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of VNET Group and SPDR SP.
Diversification Opportunities for VNET Group and SPDR SP
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between VNET and SPDR is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding VNET Group DRC and SPDR SP Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SP Dividend and VNET Group 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 VNET Group DRC are associated (or correlated) with SPDR SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SP Dividend has no effect on the direction of VNET Group i.e., VNET Group and SPDR SP go up and down completely randomly.
Pair Corralation between VNET Group and SPDR SP
Given the investment horizon of 90 days VNET Group DRC is expected to under-perform the SPDR SP. In addition to that, VNET Group is 5.18 times more volatile than SPDR SP Dividend. It trades about -0.04 of its total potential returns per unit of risk. SPDR SP Dividend is currently generating about 0.02 per unit of volatility. If you would invest 11,903 in SPDR SP Dividend on January 25, 2024 and sell it today you would earn a total of 903.00 from holding SPDR SP Dividend or generate 7.59% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 99.8% |
Values | Daily Returns |
VNET Group DRC vs. SPDR SP Dividend
Performance |
Timeline |
VNET Group DRC |
SPDR SP Dividend |
VNET Group and SPDR SP Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with VNET Group and SPDR SP
The main advantage of trading using opposite VNET Group and SPDR SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VNET Group position performs unexpectedly, SPDR SP 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 SP will offset losses from the drop in SPDR SP's long position.VNET Group vs. CLARIVATE PLC | VNET Group vs. WNS Holdings | VNET Group vs. Thoughtworks Holding | VNET Group vs. GDS Holdings |
SPDR SP vs. Vanguard Quality Factor | SPDR SP vs. Vanguard Momentum Factor | SPDR SP vs. Vanguard Multifactor | SPDR SP vs. Vanguard Minimum Volatility |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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