Correlation Between State Street and Ssga Sp
Can any of the company-specific risk be diversified away by investing in both State Street and Ssga Sp 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 State Street and Ssga Sp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between State Street Aggregate and Ssga Sp 500, you can compare the effects of market volatilities on State Street and Ssga Sp 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 State Street with a short position of Ssga Sp. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Street and Ssga Sp.
Diversification Opportunities for State Street and Ssga Sp
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between State and Ssga is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding State Street Aggregate and Ssga Sp 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ssga Sp 500 and State Street 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 State Street Aggregate are associated (or correlated) with Ssga Sp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ssga Sp 500 has no effect on the direction of State Street i.e., State Street and Ssga Sp go up and down completely randomly.
Pair Corralation between State Street and Ssga Sp
Assuming the 90 days horizon State Street is expected to generate 6.65 times less return on investment than Ssga Sp. But when comparing it to its historical volatility, State Street Aggregate is 2.26 times less risky than Ssga Sp. It trades about 0.03 of its potential returns per unit of risk. Ssga Sp 500 is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 20,390 in Ssga Sp 500 on September 3, 2024 and sell it today you would earn a total of 8,177 from holding Ssga Sp 500 or generate 40.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
State Street Aggregate vs. Ssga Sp 500
Performance |
| Timeline |
| State Street Aggregate |
| Ssga Sp 500 |
State Street and Ssga Sp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Street and Ssga Sp
The main advantage of trading using opposite State Street and Ssga Sp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Street position performs unexpectedly, Ssga Sp 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 Sp will offset losses from the drop in Ssga Sp's long position.| State Street vs. Principal Lifetime Hybrid | State Street vs. Artisan Thematic Fund | State Street vs. Old Westbury Large | State Street vs. Rbb Fund |
| Ssga Sp vs. Allianzgi Nfj Small Cap | Ssga Sp vs. Ssga International Stock | Ssga Sp vs. Oppenheimer Capital Appreciation | Ssga Sp vs. Total Return Fund |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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