Correlation Between SPDR Barclays and IShares Agency
Can any of the company-specific risk be diversified away by investing in both SPDR Barclays and IShares Agency 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 Barclays and IShares Agency into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Barclays Long and iShares Agency Bond, you can compare the effects of market volatilities on SPDR Barclays and IShares Agency 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 Barclays with a short position of IShares Agency. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Barclays and IShares Agency.
Diversification Opportunities for SPDR Barclays and IShares Agency
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SPDR and IShares is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Barclays Long and iShares Agency Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Agency Bond and SPDR Barclays 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 Barclays Long are associated (or correlated) with IShares Agency. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Agency Bond has no effect on the direction of SPDR Barclays i.e., SPDR Barclays and IShares Agency go up and down completely randomly.
Pair Corralation between SPDR Barclays and IShares Agency
Given the investment horizon of 90 days SPDR Barclays Long is expected to generate 3.6 times more return on investment than IShares Agency. However, SPDR Barclays is 3.6 times more volatile than iShares Agency Bond. It trades about 0.11 of its potential returns per unit of risk. iShares Agency Bond is currently generating about 0.22 per unit of risk. If you would invest 2,233 in SPDR Barclays Long on August 14, 2025 and sell it today you would earn a total of 70.00 from holding SPDR Barclays Long or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Barclays Long vs. iShares Agency Bond
Performance |
| Timeline |
| SPDR Barclays Long |
| iShares Agency Bond |
SPDR Barclays and IShares Agency Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Barclays and IShares Agency
The main advantage of trading using opposite SPDR Barclays and IShares Agency positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Barclays position performs unexpectedly, IShares Agency 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 IShares Agency will offset losses from the drop in IShares Agency's long position.| SPDR Barclays vs. iShares MSCI India | SPDR Barclays vs. SPDR Portfolio TIPS | SPDR Barclays vs. iShares Asia 50 | SPDR Barclays vs. SPDR SP Emerging |
| IShares Agency vs. iShares Core 10 | IShares Agency vs. Alpssmith Short Duration | IShares Agency vs. Schwab 1 5 Year | IShares Agency vs. Franklin Liberty International |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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