| SDVY Etf | | | USD 35.83 0.19 0.53% |
The current 90-days correlation between First Trust SMID and VictoryShares Small Cap is 0.94 (i.e., Almost no diversification). The correlation of First Trust is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.
First Trust Correlation With Market
Very poor diversification
The correlation between First Trust SMID and DJI is 0.85 (i.e., Very poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding First Trust SMID and DJI in the same portfolio, assuming nothing else is changed.
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World Market Map to better understand how to build diversified portfolios, which includes a position in First Trust SMID. Also, note that the market value of any etf could be closely tied with the direction of predictive economic indicators such as
signals in real.