Correlation Between BondBloxx ETF and Virtus ETF
Can any of the company-specific risk be diversified away by investing in both BondBloxx ETF and Virtus 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 BondBloxx ETF and Virtus ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BondBloxx ETF Trust and Virtus ETF Trust, you can compare the effects of market volatilities on BondBloxx ETF and Virtus 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 BondBloxx ETF with a short position of Virtus ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of BondBloxx ETF and Virtus ETF.
Diversification Opportunities for BondBloxx ETF and Virtus ETF
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BondBloxx and Virtus is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding BondBloxx ETF Trust and Virtus ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus ETF Trust and BondBloxx ETF 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 BondBloxx ETF Trust are associated (or correlated) with Virtus ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus ETF Trust has no effect on the direction of BondBloxx ETF i.e., BondBloxx ETF and Virtus ETF go up and down completely randomly.
Pair Corralation between BondBloxx ETF and Virtus ETF
Allowing for the 90-day total investment horizon BondBloxx ETF is expected to generate 1.28 times less return on investment than Virtus ETF. But when comparing it to its historical volatility, BondBloxx ETF Trust is 1.16 times less risky than Virtus ETF. It trades about 0.16 of its potential returns per unit of risk. Virtus ETF Trust is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 2,567 in Virtus ETF Trust on August 29, 2024 and sell it today you would earn a total of 195.00 from holding Virtus ETF Trust or generate 7.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BondBloxx ETF Trust vs. Virtus ETF Trust
Performance |
| Timeline |
| BondBloxx ETF Trust |
| Virtus ETF Trust |
BondBloxx ETF and Virtus ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BondBloxx ETF and Virtus ETF
The main advantage of trading using opposite BondBloxx ETF and Virtus ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BondBloxx ETF position performs unexpectedly, Virtus 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 Virtus ETF will offset losses from the drop in Virtus ETF's long position.| BondBloxx ETF vs. iShares Edge Investment | BondBloxx ETF vs. iShares Intl High | BondBloxx ETF vs. iShares JP Morgan |
| Virtus ETF vs. T Rowe Price | Virtus ETF vs. Angel Oak Ultrashort | Virtus ETF vs. T Rowe Price | Virtus ETF vs. Ab Tax Aware Short |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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