Correlation Between SSGA Active and BZDYF
Can any of the company-specific risk be diversified away by investing in both SSGA Active and BZDYF 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 SSGA Active and BZDYF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SSGA Active Trust and BZDYF, you can compare the effects of market volatilities on SSGA Active and BZDYF 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 SSGA Active with a short position of BZDYF. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSGA Active and BZDYF.
Diversification Opportunities for SSGA Active and BZDYF
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SSGA and BZDYF is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding SSGA Active Trust and BZDYF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BZDYF and SSGA Active 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 SSGA Active Trust are associated (or correlated) with BZDYF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BZDYF has no effect on the direction of SSGA Active i.e., SSGA Active and BZDYF go up and down completely randomly.
Pair Corralation between SSGA Active and BZDYF
Given the investment horizon of 90 days SSGA Active is expected to generate 3.31 times less return on investment than BZDYF. But when comparing it to its historical volatility, SSGA Active Trust is 3.49 times less risky than BZDYF. It trades about 0.09 of its potential returns per unit of risk. BZDYF is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,815 in BZDYF on August 26, 2024 and sell it today you would earn a total of 422.00 from holding BZDYF or generate 14.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 74.77% |
| Values | Daily Returns |
SSGA Active Trust vs. BZDYF
Performance |
| Timeline |
| SSGA Active Trust |
| BZDYF |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
SSGA Active and BZDYF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSGA Active and BZDYF
The main advantage of trading using opposite SSGA Active and BZDYF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSGA Active position performs unexpectedly, BZDYF 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 BZDYF will offset losses from the drop in BZDYF's long position.| SSGA Active vs. BlackRock Intermediate Muni | SSGA Active vs. SSGA Active Trust | SSGA Active vs. SPDR MarketAxess Investment | SSGA Active vs. SSGA Active Trust |
| BZDYF vs. FT Vest Equity | BZDYF vs. Zillow Group Class | BZDYF vs. Northern Lights | BZDYF vs. VanEck Vectors Moodys |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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