Correlation Between Tiaa Cref and Guggenheim Managed

Can any of the company-specific risk be diversified away by investing in both Tiaa Cref and Guggenheim Managed 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 and Guggenheim Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tiaa Cref Inflation Link and Guggenheim Managed Futures, you can compare the effects of market volatilities on Tiaa Cref and Guggenheim Managed 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 with a short position of Guggenheim Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tiaa Cref and Guggenheim Managed.

Diversification Opportunities for Tiaa Cref and Guggenheim Managed

-0.35

Correlation Coefficient

Tiaa Cref  Guggenheim Managed

Very good diversification

The 3 months correlation between Tiaa and Guggenheim is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref Inflation Link and Guggenheim Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Managed and Tiaa Cref 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 Inflation Link are associated (or correlated) with Guggenheim Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Managed has no effect on the direction of Tiaa Cref i.e., Tiaa Cref and Guggenheim Managed go up and down completely randomly.

Pair Corralation between Tiaa Cref and Guggenheim Managed

Assuming the 90 days horizon Tiaa Cref is expected to generate 9.32 times less return on investment than Guggenheim Managed. But when comparing it to its historical volatility, Tiaa Cref Inflation Link is 3.04 times less risky than Guggenheim Managed. It trades about 0.04 of its potential returns per unit of risk. Guggenheim Managed Futures is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  1,969  in Guggenheim Managed Futures on October 27, 2024 and sell it today you would earn a total of  71.00  from holding Guggenheim Managed Futures or generate 3.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Tiaa Cref Inflation Link  vs.  Guggenheim Managed Futures

Tiaa Cref Inflation

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Inflation Link are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Tiaa Cref is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Guggenheim Managed

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim Managed Futures are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Guggenheim Managed is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Tiaa Cref and Guggenheim Managed

The main advantage of trading using opposite Tiaa Cref and Guggenheim Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tiaa Cref position performs unexpectedly, Guggenheim Managed 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 Guggenheim Managed will offset losses from the drop in Guggenheim Managed's long position.

The idea behind Tiaa Cref Inflation Link and Guggenheim Managed Futures pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.