Correlation Between Unified Series and SPDR Portfolio
Can any of the company-specific risk be diversified away by investing in both Unified Series and SPDR Portfolio 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 Unified Series and SPDR Portfolio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unified Series Trust and SPDR Portfolio SP, you can compare the effects of market volatilities on Unified Series and SPDR Portfolio 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 Unified Series with a short position of SPDR Portfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unified Series and SPDR Portfolio.
Diversification Opportunities for Unified Series and SPDR Portfolio
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Unified and SPDR is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Unified Series Trust and SPDR Portfolio SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Portfolio SP and Unified Series 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 Unified Series Trust are associated (or correlated) with SPDR Portfolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Portfolio SP has no effect on the direction of Unified Series i.e., Unified Series and SPDR Portfolio go up and down completely randomly.
Pair Corralation between Unified Series and SPDR Portfolio
Given the investment horizon of 90 days Unified Series Trust is expected to generate 0.83 times more return on investment than SPDR Portfolio. However, Unified Series Trust is 1.2 times less risky than SPDR Portfolio. It trades about -0.28 of its potential returns per unit of risk. SPDR Portfolio SP is currently generating about -0.24 per unit of risk. If you would invest 2,705 in Unified Series Trust on January 20, 2024 and sell it today you would lose (114.00) from holding Unified Series Trust or give up 4.21% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Unified Series Trust vs. SPDR Portfolio SP
Performance |
Timeline |
Unified Series Trust |
SPDR Portfolio SP |
Unified Series and SPDR Portfolio Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Unified Series and SPDR Portfolio
The main advantage of trading using opposite Unified Series and SPDR Portfolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unified Series position performs unexpectedly, SPDR Portfolio 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 Portfolio will offset losses from the drop in SPDR Portfolio's long position.Unified Series vs. Dimensional Targeted Value | Unified Series vs. Dimensional World ex | Unified Series vs. Dimensional Small Cap |
SPDR Portfolio vs. First Trust Dow | SPDR Portfolio vs. iShares Russell 1000 | SPDR Portfolio vs. iShares Russell Top | SPDR Portfolio vs. Vanguard Mega Cap |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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