Correlation Between SPDR SP and State Street
Can any of the company-specific risk be diversified away by investing in both SPDR SP and State Street 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 SPDR SP and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR SP 500 and State Street, you can compare the effects of market volatilities on SPDR SP and State Street 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 SPDR SP with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR SP and State Street.
Diversification Opportunities for SPDR SP and State Street
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SPDR and State is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SPDR SP 500 and State Street in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street and SPDR SP 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 SPDR SP 500 are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street has no effect on the direction of SPDR SP i.e., SPDR SP and State Street go up and down completely randomly.
Pair Corralation between SPDR SP and State Street
If you would invest 45,212 in SPDR SP 500 on September 2, 2024 and sell it today you would earn a total of 15,043 from holding SPDR SP 500 or generate 33.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
SPDR SP 500 vs. State Street
Performance |
| Timeline |
| SPDR SP 500 |
| State Street |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
SPDR SP and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR SP and State Street
The main advantage of trading using opposite SPDR SP and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR SP position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.| SPDR SP vs. Vanguard Total Stock | SPDR SP vs. Vanguard FTSE Emerging | SPDR SP vs. FT Vest Equity | SPDR SP vs. Zillow Group Class |
| State Street vs. Vanguard Total Stock | State Street vs. SPDR SP 500 | State Street vs. iShares Core SP | State Street vs. Vanguard Total Bond |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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