Correlation Between Vanguard Emerging and Bondbloxx ETF
Can any of the company-specific risk be diversified away by investing in both Vanguard Emerging 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 Vanguard Emerging and Bondbloxx ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Emerging Markets and Bondbloxx ETF Trust, you can compare the effects of market volatilities on Vanguard Emerging 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 Vanguard Emerging with a short position of Bondbloxx ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Emerging and Bondbloxx ETF.
Diversification Opportunities for Vanguard Emerging and Bondbloxx ETF
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vanguard and Bondbloxx is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Emerging Markets 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 Vanguard Emerging 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 Vanguard Emerging Markets 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 Vanguard Emerging i.e., Vanguard Emerging and Bondbloxx ETF go up and down completely randomly.
Pair Corralation between Vanguard Emerging and Bondbloxx ETF
Given the investment horizon of 90 days Vanguard Emerging Markets is expected to generate 1.24 times more return on investment than Bondbloxx ETF. However, Vanguard Emerging is 1.24 times more volatile than Bondbloxx ETF Trust. It trades about 0.12 of its potential returns per unit of risk. Bondbloxx ETF Trust is currently generating about 0.15 per unit of risk. If you would invest 6,168 in Vanguard Emerging Markets on September 1, 2024 and sell it today you would earn a total of 357.00 from holding Vanguard Emerging Markets or generate 5.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Emerging Markets vs. Bondbloxx ETF Trust
Performance |
| Timeline |
| Vanguard Emerging Markets |
| Bondbloxx ETF Trust |
Vanguard Emerging and Bondbloxx ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Emerging and Bondbloxx ETF
The main advantage of trading using opposite Vanguard Emerging and Bondbloxx ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Emerging 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.| Vanguard Emerging vs. iShares JP Morgan | Vanguard Emerging vs. SPDR Bloomberg Barclays | Vanguard Emerging vs. SPDR DoubleLine Emerging | Vanguard Emerging vs. JPMorgan USD Emerging |
| Bondbloxx ETF vs. iShares JP Morgan | Bondbloxx ETF vs. SPDR Bloomberg Barclays | Bondbloxx ETF vs. SPDR DoubleLine Emerging | Bondbloxx ETF vs. JPMorgan USD Emerging |
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.
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