Correlation Between SPDR Portfolio and Pacer Cash
Can any of the company-specific risk be diversified away by investing in both SPDR Portfolio and Pacer Cash 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 Pacer Cash 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 Pacer Cash Cows, you can compare the effects of market volatilities on SPDR Portfolio and Pacer Cash 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 Pacer Cash. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR Portfolio and Pacer Cash.
Diversification Opportunities for SPDR Portfolio and Pacer Cash
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SPDR and Pacer is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding SPDR Portfolio SP and Pacer Cash Cows in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacer Cash Cows 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 Pacer Cash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacer Cash Cows has no effect on the direction of SPDR Portfolio i.e., SPDR Portfolio and Pacer Cash go up and down completely randomly.
Pair Corralation between SPDR Portfolio and Pacer Cash
Given the investment horizon of 90 days SPDR Portfolio SP is expected to under-perform the Pacer Cash. But the etf apears to be less risky and, when comparing its historical volatility, SPDR Portfolio SP is 1.03 times less risky than Pacer Cash. The etf trades about -0.03 of its potential returns per unit of risk. The Pacer Cash Cows is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 5,751 in Pacer Cash Cows on September 7, 2025 and sell it today you would earn a total of 316.00 from holding Pacer Cash Cows or generate 5.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPDR Portfolio SP vs. Pacer Cash Cows
Performance |
| Timeline |
| SPDR Portfolio SP |
| Pacer Cash Cows |
SPDR Portfolio and Pacer Cash Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR Portfolio and Pacer Cash
The main advantage of trading using opposite SPDR Portfolio and Pacer Cash positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR Portfolio position performs unexpectedly, Pacer Cash 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 Pacer Cash will offset losses from the drop in Pacer Cash's long position.| SPDR Portfolio vs. Strategy Shares | SPDR Portfolio vs. Freedom Day Dividend | SPDR Portfolio vs. Franklin Templeton ETF | SPDR Portfolio vs. iShares MSCI China |
| Pacer Cash vs. FT Vest Equity | Pacer Cash vs. Northern Lights | Pacer Cash vs. Diamond Hill Funds | Pacer Cash vs. Dimensional International High |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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