Correlation Between IQ MacKay and SSGA Active
Can any of the company-specific risk be diversified away by investing in both IQ MacKay 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 IQ MacKay and SSGA Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IQ MacKay Municipal and SSGA Active Trust, you can compare the effects of market volatilities on IQ MacKay 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 IQ MacKay with a short position of SSGA Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQ MacKay and SSGA Active.
Diversification Opportunities for IQ MacKay and SSGA Active
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between MMIN and SSGA is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding IQ MacKay Municipal 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 IQ MacKay 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 IQ MacKay Municipal 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 IQ MacKay i.e., IQ MacKay and SSGA Active go up and down completely randomly.
Pair Corralation between IQ MacKay and SSGA Active
Given the investment horizon of 90 days IQ MacKay Municipal is expected to generate 1.75 times more return on investment than SSGA Active. However, IQ MacKay is 1.75 times more volatile than SSGA Active Trust. It trades about 0.05 of its potential returns per unit of risk. SSGA Active Trust is currently generating about 0.07 per unit of risk. If you would invest 2,216 in IQ MacKay Municipal on September 24, 2024 and sell it today you would earn a total of 172.00 from holding IQ MacKay Municipal or generate 7.76% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
IQ MacKay Municipal vs. SSGA Active Trust
Performance |
Timeline |
IQ MacKay Municipal |
SSGA Active Trust |
IQ MacKay and SSGA Active Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with IQ MacKay and SSGA Active
The main advantage of trading using opposite IQ MacKay and SSGA Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IQ MacKay 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.IQ MacKay vs. Formidable Fortress ETF | IQ MacKay vs. Sonida Senior Living | IQ MacKay vs. China Yuchai International | IQ MacKay vs. Nine Energy Service |
SSGA Active vs. IQ MacKay Municipal | SSGA Active vs. IQ MacKay Municipal | SSGA Active vs. Franklin Liberty Intermediate | SSGA Active vs. American Century Diversified |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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