Correlation Between GraniteShares ETF and SPDR SP

Can any of the company-specific risk be diversified away by investing in both GraniteShares ETF and SPDR SP 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 GraniteShares ETF and SPDR SP into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GraniteShares ETF Trust and SPDR SP International, you can compare the effects of market volatilities on GraniteShares ETF and SPDR SP 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 GraniteShares ETF with a short position of SPDR SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares ETF and SPDR SP.

Diversification Opportunities for GraniteShares ETF and SPDR SP

-0.68

Correlation Coefficient

GraniteShares ETF  SPDR SP

Excellent diversification

The 3 months correlation between GraniteShares and SPDR is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares ETF Trust and SPDR SP International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SP International and GraniteShares ETF 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 GraniteShares ETF Trust are associated (or correlated) with SPDR SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SP International has no effect on the direction of GraniteShares ETF i.e., GraniteShares ETF and SPDR SP go up and down completely randomly.

Pair Corralation between GraniteShares ETF and SPDR SP

Given the investment horizon of 90 days GraniteShares ETF Trust is expected to under-perform the SPDR SP. In addition to that, GraniteShares ETF is 17.72 times more volatile than SPDR SP International. It trades about -0.12 of its total potential returns per unit of risk. SPDR SP International is currently generating about 0.32 per unit of volatility. If you would invest  3,471  in SPDR SP International on December 30, 2024 and sell it today you would earn a total of  380.00  from holding SPDR SP International or generate 10.95% return on investment over 90 days.

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

GraniteShares ETF Trust  vs.  SPDR SP International

GraniteShares ETF Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days GraniteShares ETF Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Etf's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the ETF venture institutional investors.

SPDR SP International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR SP International are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, SPDR SP may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with GraniteShares ETF and SPDR SP

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

The idea behind GraniteShares ETF Trust and SPDR SP International 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 CEOs Directory module to screen CEOs from public companies around the world.