Correlation Between SSGA Active and Quaker Investment

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

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

Diversification Opportunities for SSGA Active and Quaker Investment

0.95

Correlation Coefficient

SSGA Active  Quaker Investment

Almost no diversification

The 3 months correlation between SSGA and Quaker is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding SSGA Active Trust and Quaker Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quaker Investment Trust and SSGA Active 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 Active Trust are associated (or correlated) with Quaker Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quaker Investment Trust has no effect on the direction of SSGA Active i.e., SSGA Active and Quaker Investment go up and down completely randomly.

Pair Corralation between SSGA Active and Quaker Investment

Given the investment horizon of 90 days SSGA Active is expected to generate 1.35 times less return on investment than Quaker Investment. But when comparing it to its historical volatility, SSGA Active Trust is 1.47 times less risky than Quaker Investment. It trades about 0.15 of its potential returns per unit of risk. Quaker Investment Trust is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  1,685  in Quaker Investment Trust on December 20, 2024 and sell it today you would earn a total of  42.00  from holding Quaker Investment Trust or generate 2.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

SSGA Active Trust  vs.  Quaker Investment Trust

SSGA Active Trust

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SSGA Active Trust are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, SSGA Active is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Quaker Investment Trust

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Quaker Investment Trust are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Quaker Investment is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with SSGA Active and Quaker Investment

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

The idea behind SSGA Active Trust and Quaker Investment 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.

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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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.