Correlation Between Tiaa-cref Real and State Street

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

By analyzing existing cross correlation between Tiaa Cref Real Estate and State Street Aggregate, you can compare the effects of market volatilities on Tiaa-cref Real and State Street 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 Tiaa-cref Real with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tiaa-cref Real and State Street.

Diversification Opportunities for Tiaa-cref Real and State Street

0.08

Correlation Coefficient

Tiaa-cref Real  State Street

Significant diversification

The 3 months correlation between Tiaa-cref and State is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref Real Estate and State Street Aggregate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Aggregate and Tiaa-cref Real 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 Tiaa Cref Real Estate are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Aggregate has no effect on the direction of Tiaa-cref Real i.e., Tiaa-cref Real and State Street go up and down completely randomly.

Pair Corralation between Tiaa-cref Real and State Street

Assuming the 90 days horizon Tiaa-cref Real is expected to generate 1.3 times less return on investment than State Street. In addition to that, Tiaa-cref Real is 3.12 times more volatile than State Street Aggregate. It trades about 0.04 of its total potential returns per unit of risk. State Street Aggregate is currently generating about 0.17 per unit of volatility. If you would invest  8,446  in State Street Aggregate on May 28, 2025 and sell it today you would earn a total of  236.00  from holding State Street Aggregate or generate 2.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Tiaa Cref Real Estate  vs.  State Street Aggregate

Tiaa Cref Real

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Real Estate are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Tiaa-cref Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

State Street Aggregate

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in State Street Aggregate are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. 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.

Pair Trading with Tiaa-cref Real and State Street

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

The idea behind Tiaa Cref Real Estate and State Street Aggregate 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.