Correlation Between SPDR Gold and Amundi ETF

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

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

Diversification Opportunities for SPDR Gold and Amundi ETF

-0.52

Correlation Coefficient

SPDR Gold  Amundi ETF

Excellent diversification

The 3 months correlation between SPDR and Amundi is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Gold Shares and Amundi ETF MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi ETF MSCI and SPDR Gold 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 SPDR Gold Shares are associated (or correlated) with Amundi ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi ETF MSCI has no effect on the direction of SPDR Gold i.e., SPDR Gold and Amundi ETF go up and down completely randomly.

Pair Corralation between SPDR Gold and Amundi ETF

Assuming the 90 days trading horizon SPDR Gold Shares is expected to generate 1.95 times more return on investment than Amundi ETF. However, SPDR Gold is 1.95 times more volatile than Amundi ETF MSCI. It trades about 0.16 of its potential returns per unit of risk. Amundi ETF MSCI is currently generating about -0.1 per unit of risk. If you would invest  22,946  in SPDR Gold Shares on October 6, 2024 and sell it today you would earn a total of  652.00  from holding SPDR Gold Shares or generate 2.84% return on investment over 90 days.

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

SPDR Gold Shares  vs.  Amundi ETF MSCI

SPDR Gold Shares

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR Gold Shares are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, SPDR Gold may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Amundi ETF MSCI

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amundi ETF MSCI has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, Amundi ETF is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SPDR Gold and Amundi ETF

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

The idea behind SPDR Gold Shares and Amundi ETF MSCI 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.