Correlation Between State Street and Carlyle
Can any of the company-specific risk be diversified away by investing in both State Street and Carlyle 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 Carlyle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between State Street Corp and Carlyle Group, you can compare the effects of market volatilities on State Street and Carlyle 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 Carlyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Street and Carlyle.
Diversification Opportunities for State Street and Carlyle
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between State and Carlyle is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding State Street Corp and Carlyle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlyle Group 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 Corp are associated (or correlated) with Carlyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlyle Group has no effect on the direction of State Street i.e., State Street and Carlyle go up and down completely randomly.
Pair Corralation between State Street and Carlyle
Considering the 90-day investment horizon State Street Corp is expected to generate 0.66 times more return on investment than Carlyle. However, State Street Corp is 1.53 times less risky than Carlyle. It trades about 0.07 of its potential returns per unit of risk. Carlyle Group is currently generating about -0.16 per unit of risk. If you would invest 9,763 in State Street Corp on November 18, 2024 and sell it today you would earn a total of 153.00 from holding State Street Corp or generate 1.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
State Street Corp vs. Carlyle Group
Performance |
| Timeline |
| State Street Corp |
| Carlyle Group |
State Street and Carlyle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Street and Carlyle
The main advantage of trading using opposite State Street and Carlyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Street position performs unexpectedly, Carlyle 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 Carlyle will offset losses from the drop in Carlyle's long position.| State Street vs. Northern Trust | State Street vs. Franklin Resources | State Street vs. Invesco Plc | State Street vs. T Rowe Price |
| Carlyle vs. Horizon Space Acquisition | Carlyle vs. Erayak Power Solution | Carlyle vs. AlphaTime Acquisition Corp | Carlyle vs. Israel Acquisitions Corp |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Stocks Directory Find actively traded stocks across global markets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Transaction History View history of all your transactions and understand their impact on performance |