Oct

17

I've recently switched to an index trading strategy using QQQQ options which I now want to broaden, spreading my risk into similarly priced very liquid option-based instruments which are not very correlated with the main market indices, or each other, and am looking to maintain four such positions. However I'm having trouble finding low-correlation instruments with liquid options that I can use in the same way as I treat the QQQQ. Do Daily Spec readers know of ETFs with highly liquid options, or some other similar instruments?

George Zachar mentions:

The Select Sector SPDR correlation tool might be of value to you.

Phil McDonnell warns:

Careful! Before you rely on it, you want to make sure their correlations are based on net changes — weekly, daily or whatever.  Correlations based on price levels are spurious.  I did not see any mention of their methodology on their page so it would be good to check.


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