Correlation Between SSGA Active and Hartford Total
Can any of the company-specific risk be diversified away by investing in both SSGA Active and Hartford Total 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 Hartford Total 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 Hartford Total Return, you can compare the effects of market volatilities on SSGA Active and Hartford Total 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 Hartford Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSGA Active and Hartford Total.
Diversification Opportunities for SSGA Active and Hartford Total
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SSGA and Hartford is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding SSGA Active Trust and Hartford Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Total Return 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 Hartford Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Total Return has no effect on the direction of SSGA Active i.e., SSGA Active and Hartford Total go up and down completely randomly.
Pair Corralation between SSGA Active and Hartford Total
Given the investment horizon of 90 days SSGA Active Trust is expected to generate 0.65 times more return on investment than Hartford Total. However, SSGA Active Trust is 1.54 times less risky than Hartford Total. It trades about 0.1 of its potential returns per unit of risk. Hartford Total Return is currently generating about 0.05 per unit of risk. If you would invest 2,300 in SSGA Active Trust on September 1, 2024 and sell it today you would earn a total of 321.00 from holding SSGA Active Trust or generate 13.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SSGA Active Trust vs. Hartford Total Return
Performance |
| Timeline |
| SSGA Active Trust |
| Hartford Total Return |
SSGA Active and Hartford Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSGA Active and Hartford Total
The main advantage of trading using opposite SSGA Active and Hartford Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSGA Active position performs unexpectedly, Hartford Total 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 Hartford Total will offset losses from the drop in Hartford Total's long position.| SSGA Active vs. SPDR Bloomberg Barclays | SSGA Active vs. SPDR SSGA Fixed | SSGA Active vs. SPDR DoubleLine Short | SSGA Active vs. SPDR Portfolio Corporate |
| Hartford Total vs. SSGA Active Trust | Hartford Total vs. BlackRock Intermediate Muni | Hartford Total vs. iShares BBB Rated | Hartford Total vs. Xtrackers Short Duration |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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