Correlation Between IShares SPTSX and Quadravest Preferred

Can any of the company-specific risk be diversified away by investing in both IShares SPTSX and Quadravest Preferred 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 IShares SPTSX and Quadravest Preferred into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between iShares SPTSX 60 and Quadravest Preferred Split, you can compare the effects of market volatilities on IShares SPTSX and Quadravest Preferred 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 IShares SPTSX with a short position of Quadravest Preferred. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares SPTSX and Quadravest Preferred.

Diversification Opportunities for IShares SPTSX and Quadravest Preferred

0.95

Correlation Coefficient

IShares SPTSX  Quadravest Preferred

Almost no diversification

The 3 months correlation between IShares and Quadravest is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding iShares SPTSX 60 and Quadravest Preferred Split in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quadravest Preferred and IShares SPTSX 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 iShares SPTSX 60 are associated (or correlated) with Quadravest Preferred. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quadravest Preferred has no effect on the direction of IShares SPTSX i.e., IShares SPTSX and Quadravest Preferred go up and down completely randomly.

Pair Corralation between IShares SPTSX and Quadravest Preferred

Assuming the 90 days trading horizon iShares SPTSX 60 is expected to generate 1.33 times more return on investment than Quadravest Preferred. However, IShares SPTSX is 1.33 times more volatile than Quadravest Preferred Split. It trades about 0.49 of its potential returns per unit of risk. Quadravest Preferred Split is currently generating about 0.08 per unit of risk. If you would invest  4,327  in iShares SPTSX 60 on July 6, 2025 and sell it today you would earn a total of  222.00  from holding iShares SPTSX 60 or generate 5.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	95.65%
Values	Daily Returns

iShares SPTSX 60  vs.  Quadravest Preferred Split

iShares SPTSX 60

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in iShares SPTSX 60 are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, IShares SPTSX may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Quadravest Preferred

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Quadravest Preferred Split are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Quadravest Preferred is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with IShares SPTSX and Quadravest Preferred

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

The idea behind iShares SPTSX 60 and Quadravest Preferred Split 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.