Correlation Between Tiaa-cref Large-cap and SP 500
Can any of the company-specific risk be diversified away by investing in both Tiaa-cref Large-cap and SP 500 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 Large-cap and SP 500 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tiaa Cref Large Cap Value and SP 500 Financials, you can compare the effects of market volatilities on Tiaa-cref Large-cap and SP 500 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 Large-cap with a short position of SP 500. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tiaa-cref Large-cap and SP 500.
Diversification Opportunities for Tiaa-cref Large-cap and SP 500
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tiaa-cref and SPSY is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref Large Cap Value and SP 500 Financials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SP 500 Financials and Tiaa-cref Large-cap 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 Large Cap Value are associated (or correlated) with SP 500. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SP 500 Financials has no effect on the direction of Tiaa-cref Large-cap i.e., Tiaa-cref Large-cap and SP 500 go up and down completely randomly.
Pair Corralation between Tiaa-cref Large-cap and SP 500
Assuming the 90 days horizon Tiaa-cref Large-cap is expected to generate 1.47 times less return on investment than SP 500. In addition to that, Tiaa-cref Large-cap is 1.07 times more volatile than SP 500 Financials. It trades about 0.08 of its total potential returns per unit of risk. SP 500 Financials is currently generating about 0.13 per unit of volatility. If you would invest 58,793 in SP 500 Financials on August 29, 2024 and sell it today you would earn a total of 26,168 from holding SP 500 Financials or generate 44.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.7% |
| Values | Daily Returns |
Tiaa Cref Large Cap Value vs. SP 500 Financials
Performance |
| Timeline |
Tiaa-cref Large-cap and SP 500 Volatility Contrast
Predicted Return Density |
| Returns |
Tiaa Cref Large Cap Value
Pair trading matchups for Tiaa-cref Large-cap
SP 500 Financials
Pair trading matchups for SP 500
Pair Trading with Tiaa-cref Large-cap and SP 500
The main advantage of trading using opposite Tiaa-cref Large-cap and SP 500 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tiaa-cref Large-cap position performs unexpectedly, SP 500 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 SP 500 will offset losses from the drop in SP 500's long position.| Tiaa-cref Large-cap vs. Tiaa Cref Mid Cap Value | Tiaa-cref Large-cap vs. Tiaa Cref International Equity | Tiaa-cref Large-cap vs. Tiaa Cref Mid Cap Growth | Tiaa-cref Large-cap vs. Tiaa Cref Small Cap Equity |
| SP 500 vs. Estee Lauder Companies | SP 500 vs. Eastern Co | SP 500 vs. Procter Gamble | SP 500 vs. Newell Brands |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |