Correlation Between Ssga International and State Street
Can any of the company-specific risk be diversified away by investing in both Ssga International 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 Ssga International and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ssga International Stock and State Street Institutional, you can compare the effects of market volatilities on Ssga International 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 Ssga International with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ssga International and State Street.
Diversification Opportunities for Ssga International and State Street
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ssga and State is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Ssga International Stock and State Street Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Institu and Ssga International 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 International Stock 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 Institu has no effect on the direction of Ssga International i.e., Ssga International and State Street go up and down completely randomly.
Pair Corralation between Ssga International and State Street
Assuming the 90 days horizon Ssga International is expected to generate 2.01 times less return on investment than State Street. In addition to that, Ssga International is 1.21 times more volatile than State Street Institutional. It trades about 0.06 of its total potential returns per unit of risk. State Street Institutional is currently generating about 0.15 per unit of volatility. If you would invest 1,088 in State Street Institutional on September 2, 2024 and sell it today you would earn a total of 355.00 from holding State Street Institutional or generate 32.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ssga International Stock vs. State Street Institutional
Performance |
| Timeline |
| Ssga International Stock |
| State Street Institu |
Ssga International and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ssga International and State Street
The main advantage of trading using opposite Ssga International and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ssga International 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.| Ssga International vs. Lord Abbett Convertible | Ssga International vs. Advent Claymore Convertible | Ssga International vs. Virtus Convertible | Ssga International vs. Absolute Convertible Arbitrage |
| State Street vs. State Street Target | State Street vs. State Street Target | State Street vs. Ssga International Stock | State Street vs. State Street Aggregate |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |