Market Measures - July 20, 2021 - Correlation De-Risking

published 5 days ago by tastytrade, Inc.

Many think holding a number of different positions means they are properly diversified and have low levels of risk. This is not always the case and it's important to know how correlated each underlying is, as well as the strategies implemented. Out of the most popular liquid underlyings, some were correlated with the SPY while others were not. We compare two portfolios in volatile times to see the significance of incorporating less correlated underlyings.

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