Correlation Between SPDR SP and 1inch

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Can any of the company-specific risk be diversified away by investing in both SPDR SP and 1inch 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 SP and 1inch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR SP Semiconductor and 1inch, you can compare the effects of market volatilities on SPDR SP and 1inch 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 SP with a short position of 1inch. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR SP and 1inch.

Diversification Opportunities for SPDR SP and 1inch

0.55
  Correlation Coefficient

Very weak diversification

The 3 months correlation between SPDR and 1inch is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding SPDR SP Semiconductor and 1inch in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1inch and SPDR SP 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 SP Semiconductor are associated (or correlated) with 1inch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1inch has no effect on the direction of SPDR SP i.e., SPDR SP and 1inch go up and down completely randomly.

Pair Corralation between SPDR SP and 1inch

Considering the 90-day investment horizon SPDR SP Semiconductor is expected to generate 0.44 times more return on investment than 1inch. However, SPDR SP Semiconductor is 2.27 times less risky than 1inch. It trades about 0.03 of its potential returns per unit of risk. 1inch is currently generating about -0.01 per unit of risk. If you would invest  18,163  in SPDR SP Semiconductor on December 29, 2023 and sell it today you would earn a total of  4,964  from holding SPDR SP Semiconductor or generate 27.33% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy96.49%
ValuesDaily Returns

SPDR SP Semiconductor  vs.  1inch

 Performance 
       Timeline  
SPDR SP Semiconductor 

Risk-Adjusted Performance

2 of 100

 
Low
 
High
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in SPDR SP Semiconductor are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, SPDR SP is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.
1inch 

Risk-Adjusted Performance

8 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in 1inch are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical indicators, 1inch exhibited solid returns over the last few months and may actually be approaching a breakup point.

SPDR SP and 1inch Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SPDR SP and 1inch

The main advantage of trading using opposite SPDR SP and 1inch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR SP position performs unexpectedly, 1inch 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 1inch will offset losses from the drop in 1inch's long position.
The idea behind SPDR SP Semiconductor and 1inch pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

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