Correlation Between Pacer Cash and SPDR SSgA
Can any of the company-specific risk be diversified away by investing in both Pacer Cash and SPDR 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 Pacer Cash and SPDR SSgA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pacer Cash Cows and SPDR SSgA Ultra, you can compare the effects of market volatilities on Pacer Cash and SPDR 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 Pacer Cash with a short position of SPDR SSgA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacer Cash and SPDR SSgA.
Diversification Opportunities for Pacer Cash and SPDR SSgA
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Pacer and SPDR is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Pacer Cash Cows and SPDR SSgA Ultra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SSgA Ultra and Pacer Cash 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 Pacer Cash Cows are associated (or correlated) with SPDR SSgA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SSgA Ultra has no effect on the direction of Pacer Cash i.e., Pacer Cash and SPDR SSgA go up and down completely randomly.
Pair Corralation between Pacer Cash and SPDR SSgA
Given the investment horizon of 90 days Pacer Cash Cows is expected to generate 6.47 times more return on investment than SPDR SSgA. However, Pacer Cash is 6.47 times more volatile than SPDR SSgA Ultra. It trades about 0.2 of its potential returns per unit of risk. SPDR SSgA Ultra is currently generating about 0.4 per unit of risk. If you would invest 2,381 in Pacer Cash Cows on June 1, 2025 and sell it today you would earn a total of 105.00 from holding Pacer Cash Cows or generate 4.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.44% |
| Values | Daily Returns |
Pacer Cash Cows vs. SPDR SSgA Ultra
Performance |
| Timeline |
| Pacer Cash Cows |
| SPDR SSgA Ultra |
Pacer Cash and SPDR SSgA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pacer Cash and SPDR SSgA
The main advantage of trading using opposite Pacer Cash and SPDR SSgA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pacer Cash position performs unexpectedly, SPDR 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 SPDR SSgA will offset losses from the drop in SPDR SSgA's long position.| Pacer Cash vs. VanEck Vectors Moodys | Pacer Cash vs. BondBloxx ETF Trust | Pacer Cash vs. Vanguard ESG Corporate | Pacer Cash vs. Vanguard Intermediate Term Corporate |
| SPDR SSgA vs. SPDR Bloomberg Investment | SPDR SSgA vs. SPDR Bloomberg 1 10 | SPDR SSgA vs. iShares Short Maturity | SPDR SSgA vs. Invesco Ultra Short |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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