Correlation Between State Street and Invesco Municipal
Can any of the company-specific risk be diversified away by investing in both State Street and Invesco Municipal 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 State Street and Invesco Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between State Street Master and Invesco Municipal Income, you can compare the effects of market volatilities on State Street and Invesco Municipal 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 State Street with a short position of Invesco Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Street and Invesco Municipal.
Diversification Opportunities for State Street and Invesco Municipal
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between State and Invesco is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding State Street Master and Invesco Municipal Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Municipal Income and State Street 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 State Street Master are associated (or correlated) with Invesco Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Municipal Income has no effect on the direction of State Street i.e., State Street and Invesco Municipal go up and down completely randomly.
Pair Corralation between State Street and Invesco Municipal
If you would invest 100.00 in State Street Master on November 3, 2024 and sell it today you would earn a total of 0.00 from holding State Street Master or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
State Street Master vs. Invesco Municipal Income
Performance |
| Timeline |
| State Street Master |
| Invesco Municipal Income |
State Street and Invesco Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Street and Invesco Municipal
The main advantage of trading using opposite State Street and Invesco Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Street position performs unexpectedly, Invesco Municipal 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 Invesco Municipal will offset losses from the drop in Invesco Municipal's long position.| State Street vs. Morgan Stanley Emerging | State Street vs. Mid Cap 15x Strategy | State Street vs. Angel Oak Multi Strategy | State Street vs. Eagle Mlp Strategy |
| Invesco Municipal vs. Invesco Municipal Income | Invesco Municipal vs. Invesco Municipal Income | Invesco Municipal vs. Aim Investment Securities | Invesco Municipal vs. Oppenheimer Rising Dividends |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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