Correlation Between Valeo SE and Bondbloxx ETF

Can any of the company-specific risk be diversified away by investing in both Valeo SE 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 Valeo SE and Bondbloxx ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Valeo SE and Bondbloxx ETF Trust, you can compare the effects of market volatilities on Valeo SE 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 Valeo SE with a short position of Bondbloxx ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valeo SE and Bondbloxx ETF.

Diversification Opportunities for Valeo SE and Bondbloxx ETF

-0.01

Correlation Coefficient

Valeo SE  Bondbloxx ETF

Good diversification

The 3 months correlation between Valeo and Bondbloxx is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Valeo SE 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 Valeo SE 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 Valeo SE 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 Valeo SE i.e., Valeo SE and Bondbloxx ETF go up and down completely randomly.

Pair Corralation between Valeo SE and Bondbloxx ETF

Assuming the 90 days horizon Valeo SE is expected to generate 56.56 times more return on investment than Bondbloxx ETF. However, Valeo SE is 56.56 times more volatile than Bondbloxx ETF Trust. It trades about 0.14 of its potential returns per unit of risk. Bondbloxx ETF Trust is currently generating about 0.2 per unit of risk. If you would invest  797.00  in Valeo SE on September 22, 2024 and sell it today you would earn a total of  106.00  from holding Valeo SE or generate 13.3% return on investment over 90 days.

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

Valeo SE  vs.  Bondbloxx ETF Trust

Valeo SE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Valeo SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Bondbloxx ETF Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bondbloxx ETF Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Bondbloxx ETF is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Valeo SE and Bondbloxx ETF

The main advantage of trading using opposite Valeo SE and Bondbloxx ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valeo SE 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.

The idea behind Valeo SE and Bondbloxx ETF Trust 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.