Correlation Between Bondbloxx ETF and China Merchants
Can any of the company-specific risk be diversified away by investing in both Bondbloxx ETF and China Merchants 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 China Merchants 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 China Merchants Bank, you can compare the effects of market volatilities on Bondbloxx ETF and China Merchants 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 China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bondbloxx ETF and China Merchants.
Diversification Opportunities for Bondbloxx ETF and China Merchants
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bondbloxx and China is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Bondbloxx ETF Trust and China Merchants Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Merchants Bank 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 China Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Merchants Bank has no effect on the direction of Bondbloxx ETF i.e., Bondbloxx ETF and China Merchants go up and down completely randomly.
Pair Corralation between Bondbloxx ETF and China Merchants
Given the investment horizon of 90 days Bondbloxx ETF Trust is expected to generate 0.03 times more return on investment than China Merchants. However, Bondbloxx ETF Trust is 33.29 times less risky than China Merchants. It trades about 0.07 of its potential returns per unit of risk. China Merchants Bank is currently generating about -0.03 per unit of risk. If you would invest 4,909 in Bondbloxx ETF Trust on September 13, 2024 and sell it today you would earn a total of 13.00 from holding Bondbloxx ETF Trust or generate 0.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bondbloxx ETF Trust vs. China Merchants Bank
Performance |
| Timeline |
| Bondbloxx ETF Trust |
| China Merchants Bank |
Bondbloxx ETF and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bondbloxx ETF and China Merchants
The main advantage of trading using opposite Bondbloxx ETF and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bondbloxx ETF position performs unexpectedly, China Merchants 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 China Merchants will offset losses from the drop in China Merchants' long position.| Bondbloxx ETF vs. Bondbloxx ETF Trust | Bondbloxx ETF vs. Bondbloxx ETF Trust | Bondbloxx ETF vs. Bondbloxx ETF Trust | Bondbloxx ETF vs. Bondbloxx ETF Trust |
| China Merchants vs. PT Bank Rakyat | China Merchants vs. Morningstar Unconstrained Allocation | China Merchants vs. Bondbloxx ETF Trust | China Merchants vs. Spring Valley Acquisition |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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