Correlation Between VanEck JP and SPDR Bloomberg

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

By analyzing existing cross correlation between VanEck JP Morgan and SPDR Bloomberg Barclays, you can compare the effects of market volatilities on VanEck JP and SPDR Bloomberg 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 VanEck JP with a short position of SPDR Bloomberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck JP and SPDR Bloomberg.

Diversification Opportunities for VanEck JP and SPDR Bloomberg

0.88

Correlation Coefficient

VanEck JP  SPDR Bloomberg

Very poor diversification

The 3 months correlation between VanEck and SPDR is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding VanEck JP Morgan and SPDR Bloomberg Barclays in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Bloomberg Barclays and VanEck JP 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 VanEck JP Morgan are associated (or correlated) with SPDR Bloomberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Bloomberg Barclays has no effect on the direction of VanEck JP i.e., VanEck JP and SPDR Bloomberg go up and down completely randomly.

Pair Corralation between VanEck JP and SPDR Bloomberg

Given the investment horizon of 90 days VanEck JP is expected to generate 1.37 times less return on investment than SPDR Bloomberg. In addition to that, VanEck JP is 1.1 times more volatile than SPDR Bloomberg Barclays. It trades about 0.04 of its total potential returns per unit of risk. SPDR Bloomberg Barclays is currently generating about 0.06 per unit of volatility. If you would invest  2,424  in SPDR Bloomberg Barclays on December 4, 2024 and sell it today you would earn a total of  32.00  from holding SPDR Bloomberg Barclays or generate 1.32% return on investment over 90 days.

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

VanEck JP Morgan  vs.  SPDR Bloomberg Barclays

VanEck JP Morgan

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck JP Morgan are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound essential indicators, VanEck JP is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

SPDR Bloomberg Barclays

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR Bloomberg Barclays are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, SPDR Bloomberg is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with VanEck JP and SPDR Bloomberg

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

The idea behind VanEck JP Morgan and SPDR Bloomberg Barclays 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.

Check out your portfolio center.

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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..