Correlation Between Pax Global and Bondbloxx ETF

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

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

Diversification Opportunities for Pax Global and Bondbloxx ETF

0.23

Correlation Coefficient

Pax Global  Bondbloxx ETF

Modest diversification

The 3 months correlation between Pax and Bondbloxx is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Pax Global Environmental 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 Pax Global 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 Pax Global Environmental 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 Pax Global i.e., Pax Global and Bondbloxx ETF go up and down completely randomly.

Pair Corralation between Pax Global and Bondbloxx ETF

Assuming the 90 days horizon Pax Global Environmental is expected to generate 0.79 times more return on investment than Bondbloxx ETF. However, Pax Global Environmental is 1.27 times less risky than Bondbloxx ETF. It trades about 0.01 of its potential returns per unit of risk. Bondbloxx ETF Trust is currently generating about -0.13 per unit of risk. If you would invest  2,458  in Pax Global Environmental on September 13, 2024 and sell it today you would earn a total of  2.00  from holding Pax Global Environmental or generate 0.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Pax Global Environmental  vs.  Bondbloxx ETF Trust

Pax Global Environmental

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Pax Global Environmental has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Pax Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

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 latest unfluctuating performance, the Etf's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the ETF investors.

Pair Trading with Pax Global and Bondbloxx ETF

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

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 Commodity Directory module to find actively traded commodities issued by global exchanges.