Correlation Between EntrepreneurShares and SSGA Active

Can any of the company-specific risk be diversified away by investing in both EntrepreneurShares and SSGA Active 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 EntrepreneurShares and SSGA Active into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between EntrepreneurShares and SSGA Active Trust, you can compare the effects of market volatilities on EntrepreneurShares and SSGA Active 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 EntrepreneurShares with a short position of SSGA Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of EntrepreneurShares and SSGA Active.

Diversification Opportunities for EntrepreneurShares and SSGA Active

-0.3

Correlation Coefficient

EntrepreneurShares  SSGA Active

Very good diversification

The 3 months correlation between EntrepreneurShares and SSGA is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding EntrepreneurShares and SSGA Active Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSGA Active Trust and EntrepreneurShares 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 EntrepreneurShares are associated (or correlated) with SSGA Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSGA Active Trust has no effect on the direction of EntrepreneurShares i.e., EntrepreneurShares and SSGA Active go up and down completely randomly.

Pair Corralation between EntrepreneurShares and SSGA Active

If you would invest  1,321  in EntrepreneurShares on October 9, 2024 and sell it today you would earn a total of  0.00  from holding EntrepreneurShares or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.26%
Values	Daily Returns

EntrepreneurShares  vs.  SSGA Active Trust

EntrepreneurShares

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EntrepreneurShares has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, EntrepreneurShares is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

SSGA Active Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SSGA Active Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, SSGA Active is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with EntrepreneurShares and SSGA Active

The main advantage of trading using opposite EntrepreneurShares and SSGA Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EntrepreneurShares position performs unexpectedly, SSGA Active 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 Active will offset losses from the drop in SSGA Active's long position.

The idea behind EntrepreneurShares and SSGA Active Trust pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.