Correlation Between SSGA Active and FRN
Can any of the company-specific risk be diversified away by investing in both SSGA Active and FRN 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 FRN 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 FRN, you can compare the effects of market volatilities on SSGA Active and FRN 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 FRN. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSGA Active and FRN.
Diversification Opportunities for SSGA Active and FRN
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SSGA and FRN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SSGA Active Trust and FRN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRN 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 FRN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRN has no effect on the direction of SSGA Active i.e., SSGA Active and FRN go up and down completely randomly.
Pair Corralation between SSGA Active and FRN
If you would invest (100.00) in FRN on October 20, 2024 and sell it today you would earn a total of 100.00 from holding FRN or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
SSGA Active Trust vs. FRN
Performance |
| Timeline |
| SSGA Active Trust |
| FRN |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
SSGA Active and FRN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSGA Active and FRN
The main advantage of trading using opposite SSGA Active and FRN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSGA Active position performs unexpectedly, FRN 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 FRN will offset losses from the drop in FRN'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 |
| FRN vs. FT Vest Equity | FRN vs. Zillow Group Class | FRN vs. Northern Lights | FRN 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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