Correlation Between Valic Company and State Street
Can any of the company-specific risk be diversified away by investing in both Valic Company 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 Valic Company and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valic Company I and State Street Equity, you can compare the effects of market volatilities on Valic Company 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 Valic Company with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valic Company and State Street.
Diversification Opportunities for Valic Company and State Street
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Valic and State is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Valic Company I and State Street Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Equity and Valic Company 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 Valic Company I 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 Equity has no effect on the direction of Valic Company i.e., Valic Company and State Street go up and down completely randomly.
Pair Corralation between Valic Company and State Street
Assuming the 90 days horizon Valic Company I is expected to generate 1.18 times more return on investment than State Street. However, Valic Company is 1.18 times more volatile than State Street Equity. It trades about 0.21 of its potential returns per unit of risk. State Street Equity is currently generating about 0.03 per unit of risk. If you would invest 1,276 in Valic Company I on October 23, 2024 and sell it today you would earn a total of 55.00 from holding Valic Company I or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Valic Company I vs. State Street Equity
Performance |
| Timeline |
| Valic Company I |
| State Street Equity |
Valic Company and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valic Company and State Street
The main advantage of trading using opposite Valic Company and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valic Company 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.| Valic Company vs. Tiaa Cref Life Funds | Valic Company vs. Franklin Government Money | Valic Company vs. Bbh Trust | Valic Company vs. Pace Select Advisors |
| State Street vs. William Blair Small | State Street vs. American Century Etf | State Street vs. Valic Company I | State Street vs. Fpa Queens Road |
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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