Correlation Between Nasdaq-100 Fund and Tiaa-cref Large-cap
Can any of the company-specific risk be diversified away by investing in both Nasdaq-100 Fund and Tiaa-cref Large-cap 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 Nasdaq-100 Fund and Tiaa-cref Large-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 Fund Class and Tiaa Cref Large Cap Growth, you can compare the effects of market volatilities on Nasdaq-100 Fund and Tiaa-cref Large-cap 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 Nasdaq-100 Fund with a short position of Tiaa-cref Large-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq-100 Fund and Tiaa-cref Large-cap.
Diversification Opportunities for Nasdaq-100 Fund and Tiaa-cref Large-cap
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nasdaq-100 and Tiaa-cref is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 Fund Class and Tiaa Cref Large Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa-cref Large-cap and Nasdaq-100 Fund 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 Nasdaq 100 Fund Class are associated (or correlated) with Tiaa-cref Large-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa-cref Large-cap has no effect on the direction of Nasdaq-100 Fund i.e., Nasdaq-100 Fund and Tiaa-cref Large-cap go up and down completely randomly.
Pair Corralation between Nasdaq-100 Fund and Tiaa-cref Large-cap
Assuming the 90 days horizon Nasdaq-100 Fund is expected to generate 1.07 times less return on investment than Tiaa-cref Large-cap. In addition to that, Nasdaq-100 Fund is 1.03 times more volatile than Tiaa Cref Large Cap Growth. It trades about 0.07 of its total potential returns per unit of risk. Tiaa Cref Large Cap Growth is currently generating about 0.08 per unit of volatility. If you would invest 2,720 in Tiaa Cref Large Cap Growth on September 5, 2024 and sell it today you would earn a total of 327.00 from holding Tiaa Cref Large Cap Growth or generate 12.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nasdaq 100 Fund Class vs. Tiaa Cref Large Cap Growth
Performance |
| Timeline |
| Nasdaq 100 Fund |
| Tiaa-cref Large-cap |
Nasdaq-100 Fund and Tiaa-cref Large-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq-100 Fund and Tiaa-cref Large-cap
The main advantage of trading using opposite Nasdaq-100 Fund and Tiaa-cref Large-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq-100 Fund position performs unexpectedly, Tiaa-cref Large-cap 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 Tiaa-cref Large-cap will offset losses from the drop in Tiaa-cref Large-cap's long position.| Nasdaq-100 Fund vs. Nasdaq 100 Fund Class | Nasdaq-100 Fund vs. Nasdaq 100 Fund Class | Nasdaq-100 Fund vs. Nasdaq 100 Profund Nasdaq 100 | Nasdaq-100 Fund vs. Select Fund R |
| Tiaa-cref Large-cap vs. Tiaa Cref Large Cap Growth | Tiaa-cref Large-cap vs. Tiaa Cref Large Cap Value | Tiaa-cref Large-cap vs. Tiaa Cref Large Cap Growth | Tiaa-cref Large-cap vs. Tiaa Cref Growth Income |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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