Correlation Between FrontView REIT, and SPDR Series

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

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

Diversification Opportunities for FrontView REIT, and SPDR Series

0.2

Correlation Coefficient

FrontView REIT,  SPDR Series

Modest diversification

The 3 months correlation between FrontView and SPDR is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding FrontView REIT, and SPDR Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Series Trust and FrontView REIT, 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 FrontView REIT, are associated (or correlated) with SPDR Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Series Trust has no effect on the direction of FrontView REIT, i.e., FrontView REIT, and SPDR Series go up and down completely randomly.

Pair Corralation between FrontView REIT, and SPDR Series

Considering the 90-day investment horizon FrontView REIT, is expected to under-perform the SPDR Series. In addition to that, FrontView REIT, is 1.2 times more volatile than SPDR Series Trust. It trades about -0.04 of its total potential returns per unit of risk. SPDR Series Trust is currently generating about 0.09 per unit of volatility. If you would invest  106,402  in SPDR Series Trust on September 30, 2024 and sell it today you would earn a total of  15,098  from holding SPDR Series Trust or generate 14.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	50.81%
Values	Daily Returns

FrontView REIT,  vs.  SPDR Series Trust

FrontView REIT,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FrontView REIT, has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, FrontView REIT, is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

SPDR Series Trust

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR Series Trust are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, SPDR Series may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with FrontView REIT, and SPDR Series

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

The idea behind FrontView REIT, and SPDR Series Trust 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.