Correlation Between SPDR DoubleLine and IShares 0

Can any of the company-specific risk be diversified away by investing in both SPDR DoubleLine and IShares 0 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 0 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 0 5 Year, you can compare the effects of market volatilities on SPDR DoubleLine and IShares 0 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 0. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR DoubleLine and IShares 0.

Diversification Opportunities for SPDR DoubleLine and IShares 0

0.71

Correlation Coefficient

SPDR DoubleLine  IShares 0

Poor diversification

The 3 months correlation between SPDR and IShares is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding SPDR DoubleLine Short and iShares 0 5 Year in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares 0 5 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 0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares 0 5 has no effect on the direction of SPDR DoubleLine i.e., SPDR DoubleLine and IShares 0 go up and down completely randomly.

Pair Corralation between SPDR DoubleLine and IShares 0

Given the investment horizon of 90 days SPDR DoubleLine Short is expected to under-perform the IShares 0. But the etf apears to be less risky and, when comparing its historical volatility, SPDR DoubleLine Short is 1.58 times less risky than IShares 0. The etf trades about -0.13 of its potential returns per unit of risk. The iShares 0 5 Year is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest  4,899  in iShares 0 5 Year on January 29, 2024 and sell it today you would lose (11.00) from holding iShares 0 5 Year or give up 0.22% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

SPDR DoubleLine Short  vs.  iShares 0 5 Year

SPDR DoubleLine Short

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR DoubleLine Short are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, SPDR DoubleLine is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

iShares 0 5

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iShares 0 5 Year has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, IShares 0 is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with SPDR DoubleLine and IShares 0

The main advantage of trading using opposite SPDR DoubleLine and IShares 0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR DoubleLine position performs unexpectedly, IShares 0 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 0 will offset losses from the drop in IShares 0's long position.

The idea behind SPDR DoubleLine Short and iShares 0 5 Year 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.