Correlation Between SPDR Portfolio and Schwab Mid
Can any of the company-specific risk be diversified away by investing in both SPDR Portfolio and Schwab Mid 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 Portfolio and Schwab Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR Portfolio SP and Schwab Mid Cap ETF, you can compare the effects of market volatilities on SPDR Portfolio and Schwab Mid 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 Portfolio with a short position of Schwab Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Portfolio and Schwab Mid.
Diversification Opportunities for SPDR Portfolio and Schwab Mid
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SPDR and Schwab is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Portfolio SP and Schwab Mid Cap ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schwab Mid Cap and SPDR Portfolio 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 Portfolio SP are associated (or correlated) with Schwab Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schwab Mid Cap has no effect on the direction of SPDR Portfolio i.e., SPDR Portfolio and Schwab Mid go up and down completely randomly.
Pair Corralation between SPDR Portfolio and Schwab Mid
Given the investment horizon of 90 days SPDR Portfolio is expected to generate 1.65 times less return on investment than Schwab Mid. But when comparing it to its historical volatility, SPDR Portfolio SP is 1.27 times less risky than Schwab Mid. It trades about 0.07 of its potential returns per unit of risk. Schwab Mid Cap ETF is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,958 in Schwab Mid Cap ETF on October 9, 2025 and sell it today you would earn a total of 160.00 from holding Schwab Mid Cap ETF or generate 5.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Portfolio SP vs. Schwab Mid Cap ETF
Performance |
| Timeline |
| SPDR Portfolio SP |
| Schwab Mid Cap |
SPDR Portfolio and Schwab Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Portfolio and Schwab Mid
The main advantage of trading using opposite SPDR Portfolio and Schwab Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Portfolio position performs unexpectedly, Schwab Mid 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 Schwab Mid will offset losses from the drop in Schwab Mid's long position.| SPDR Portfolio vs. Vanguard ESG Stock | SPDR Portfolio vs. SPDR Portfolio SP | SPDR Portfolio vs. Invesco SP 500 | SPDR Portfolio vs. Schwab Mid Cap ETF |
| Schwab Mid vs. Schwab Large Cap Value | Schwab Mid vs. Vanguard FTSE All World | Schwab Mid vs. SPDR Portfolio SP | Schwab Mid vs. SPDR Portfolio SP |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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