Correlation Between SSgA SPDR and SSgA

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

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

Diversification Opportunities for SSgA SPDR and SSgA

0.0

Correlation Coefficient

SSgA SPDR  SSgA

Pay attention - limited upside

The 3 months correlation between SSgA and SSgA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SSgA SPDR ETFs and SSgA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSgA and SSgA SPDR 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 SPDR ETFs are associated (or correlated) with SSgA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSgA has no effect on the direction of SSgA SPDR i.e., SSgA SPDR and SSgA go up and down completely randomly.

Pair Corralation between SSgA SPDR and SSgA

If you would invest  8,200  in SSgA SPDR ETFs on September 13, 2024 and sell it today you would earn a total of  1,940  from holding SSgA SPDR ETFs or generate 23.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

SSgA SPDR ETFs  vs.  SSgA

SSgA SPDR ETFs

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SSgA SPDR ETFs are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent basic indicators, SSgA SPDR may actually be approaching a critical reversion point that can send shares even higher in January 2025.

SSgA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SSgA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SSgA is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SSgA SPDR and SSgA

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

The idea behind SSgA SPDR ETFs and SSgA 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.