Correlation Between State Street and Old Westbury

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

By analyzing existing cross correlation between State Street Target and Old Westbury Large, you can compare the effects of market volatilities on State Street and Old Westbury 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 State Street with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Street and Old Westbury.

Diversification Opportunities for State Street and Old Westbury

0.0

Correlation Coefficient

State Street  Old Westbury

Pay attention - limited upside

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

Pair Corralation between State Street and Old Westbury

If you would invest  2,221  in Old Westbury Large on June 28, 2025 and sell it today you would earn a total of  48.00  from holding Old Westbury Large or generate 2.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

State Street Target  vs.  Old Westbury Large

State Street Target

Risk-Adjusted Performance

Weakest

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

Old Westbury Large

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Old Westbury Large are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Old Westbury is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with State Street and Old Westbury

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

The idea behind State Street Target and Old Westbury Large 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.