Correlation Between Hartford Municipal and SSGA Active
Can any of the company-specific risk be diversified away by investing in both Hartford Municipal and SSGA Active 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 Hartford Municipal and SSGA Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Municipal Opportunities and SSGA Active Trust, you can compare the effects of market volatilities on Hartford Municipal and SSGA Active 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 Hartford Municipal with a short position of SSGA Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Municipal and SSGA Active.
Diversification Opportunities for Hartford Municipal and SSGA Active
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hartford and SSGA is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Municipal Opportuniti and SSGA Active Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSGA Active Trust and Hartford Municipal 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 Hartford Municipal Opportunities are associated (or correlated) with SSGA Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSGA Active Trust has no effect on the direction of Hartford Municipal i.e., Hartford Municipal and SSGA Active go up and down completely randomly.
Pair Corralation between Hartford Municipal and SSGA Active
Given the investment horizon of 90 days Hartford Municipal Opportunities is expected to generate 1.36 times more return on investment than SSGA Active. However, Hartford Municipal is 1.36 times more volatile than SSGA Active Trust. It trades about 0.13 of its potential returns per unit of risk. SSGA Active Trust is currently generating about 0.16 per unit of risk. If you would invest 3,886 in Hartford Municipal Opportunities on August 27, 2024 and sell it today you would earn a total of 34.00 from holding Hartford Municipal Opportunities or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hartford Municipal Opportuniti vs. SSGA Active Trust
Performance |
| Timeline |
| Hartford Municipal |
| SSGA Active Trust |
Hartford Municipal and SSGA Active Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Municipal and SSGA Active
The main advantage of trading using opposite Hartford Municipal and SSGA Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Municipal position performs unexpectedly, SSGA Active 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 SSGA Active will offset losses from the drop in SSGA Active's long position.| Hartford Municipal vs. SSGA Active Trust | Hartford Municipal vs. SPDR MarketAxess Investment | Hartford Municipal vs. SSGA Active Trust |
| SSGA Active vs. SSGA Active Trust | SSGA Active vs. SPDR MarketAxess Investment | SSGA Active vs. SSGA Active Trust |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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