Correlation Between Procter Gamble and State Street

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

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

Diversification Opportunities for Procter Gamble and State Street

-0.7

Correlation Coefficient

Procter Gamble  State Street

Excellent diversification

The 3 months correlation between Procter and State is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and State Street Premier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Premier and Procter Gamble 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 Procter Gamble 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 Premier has no effect on the direction of Procter Gamble i.e., Procter Gamble and State Street go up and down completely randomly.

Pair Corralation between Procter Gamble and State Street

Allowing for the 90-day total investment horizon Procter Gamble is expected to under-perform the State Street. But the stock apears to be less risky and, when comparing its historical volatility, Procter Gamble is 1.06 times less risky than State Street. The stock trades about -0.13 of its potential returns per unit of risk. The State Street Premier is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  13,112  in State Street Premier on September 6, 2025 and sell it today you would earn a total of  860.00  from holding State Street Premier or generate 6.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Procter Gamble  vs.  State Street Premier

Procter Gamble

Risk-Adjusted Performance

Weakest

Over the last 90 days Procter Gamble has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

State Street Premier

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in State Street Premier are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, State Street may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Pair Trading with Procter Gamble and State Street

The main advantage of trading using opposite Procter Gamble and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble 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 Procter Gamble and State Street Premier 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.