Correlation Between Xtrackers California and BondBloxx ETF
Can any of the company-specific risk be diversified away by investing in both Xtrackers California and BondBloxx ETF 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 Xtrackers California and BondBloxx ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers California Municipal and BondBloxx ETF Trust, you can compare the effects of market volatilities on Xtrackers California and BondBloxx ETF 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 Xtrackers California with a short position of BondBloxx ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers California and BondBloxx ETF.
Diversification Opportunities for Xtrackers California and BondBloxx ETF
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xtrackers and BondBloxx is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers California Municipal and BondBloxx ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BondBloxx ETF Trust and Xtrackers California 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 Xtrackers California Municipal are associated (or correlated) with BondBloxx ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BondBloxx ETF Trust has no effect on the direction of Xtrackers California i.e., Xtrackers California and BondBloxx ETF go up and down completely randomly.
Pair Corralation between Xtrackers California and BondBloxx ETF
Allowing for the 90-day total investment horizon Xtrackers California Municipal is expected to under-perform the BondBloxx ETF. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers California Municipal is 1.25 times less risky than BondBloxx ETF. The etf trades about -0.01 of its potential returns per unit of risk. The BondBloxx ETF Trust is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4,737 in BondBloxx ETF Trust on January 13, 2025 and sell it today you would earn a total of 197.00 from holding BondBloxx ETF Trust or generate 4.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 91.89% |
| Values | Daily Returns |
Xtrackers California Municipal vs. BondBloxx ETF Trust
Performance |
| Timeline |
| Xtrackers California |
| BondBloxx ETF Trust |
Xtrackers California and BondBloxx ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers California and BondBloxx ETF
The main advantage of trading using opposite Xtrackers California and BondBloxx ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers California position performs unexpectedly, BondBloxx ETF 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 BondBloxx ETF will offset losses from the drop in BondBloxx ETF's long position.| Xtrackers California vs. VCRM | Xtrackers California vs. IQ MacKay Municipal | Xtrackers California vs. IQ MacKay Municipal | Xtrackers California vs. ALPS Intermediate Municipal |
| BondBloxx ETF vs. VanEck Vectors Moodys | BondBloxx ETF vs. Vanguard ESG Corporate | BondBloxx ETF vs. Pacer Cash Cows | BondBloxx ETF vs. Vanguard Intermediate Term Corporate |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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