Correlation Between Bondbloxx ETF and Freedom Bank

Can any of the company-specific risk be diversified away by investing in both Bondbloxx ETF and Freedom Bank 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 Freedom Bank 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 Freedom Bank of, you can compare the effects of market volatilities on Bondbloxx ETF and Freedom Bank 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 Freedom Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bondbloxx ETF and Freedom Bank.

Diversification Opportunities for Bondbloxx ETF and Freedom Bank

-0.27

Correlation Coefficient

Bondbloxx ETF  Freedom Bank

Very good diversification

The 3 months correlation between Bondbloxx and Freedom is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Bondbloxx ETF Trust and Freedom Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freedom 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 Freedom Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freedom Bank has no effect on the direction of Bondbloxx ETF i.e., Bondbloxx ETF and Freedom Bank go up and down completely randomly.

Pair Corralation between Bondbloxx ETF and Freedom Bank

Given the investment horizon of 90 days Bondbloxx ETF Trust is expected to generate 0.13 times more return on investment than Freedom Bank. However, Bondbloxx ETF Trust is 7.99 times less risky than Freedom Bank. It trades about 0.16 of its potential returns per unit of risk. Freedom Bank of is currently generating about -0.01 per unit of risk. If you would invest  4,579  in Bondbloxx ETF Trust on December 2, 2024 and sell it today you would earn a total of  365.00  from holding Bondbloxx ETF Trust or generate 7.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	77.57%
Values	Daily Returns

Bondbloxx ETF Trust  vs.  Freedom Bank of

Bondbloxx ETF Trust

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bondbloxx ETF Trust are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. 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.

Freedom Bank

Risk-Adjusted Performance

Very Weak

Over the last 90 days Freedom Bank of has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Freedom Bank is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bondbloxx ETF and Freedom Bank

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

The idea behind Bondbloxx ETF Trust and Freedom Bank of 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.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.