Correlation Between Bondbloxx ETF and CGI

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

Diversification Opportunities for Bondbloxx ETF and CGI

0.79
  Correlation Coefficient

Poor diversification

The 3 months correlation between Bondbloxx and CGI is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Bondbloxx ETF Trust and CGI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CGI Inc 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 CGI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CGI Inc has no effect on the direction of Bondbloxx ETF i.e., Bondbloxx ETF and CGI go up and down completely randomly.

Pair Corralation between Bondbloxx ETF and CGI

Given the investment horizon of 90 days Bondbloxx ETF Trust is expected to generate 0.11 times more return on investment than CGI. However, Bondbloxx ETF Trust is 9.4 times less risky than CGI. It trades about 0.06 of its potential returns per unit of risk. CGI Inc is currently generating about 0.0 per unit of risk. If you would invest  4,929  in Bondbloxx ETF Trust on October 30, 2022 and sell it today you would earn a total of  43.00  from holding Bondbloxx ETF Trust or generate 0.87% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy37.5%
ValuesDaily Returns

Bondbloxx ETF Trust  vs.  CGI Inc

 Performance (%) 
       Timeline  
Bondbloxx ETF Trust 
Bondbloxx Performance
12 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Bondbloxx ETF Trust are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Bondbloxx ETF is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Bondbloxx Price Channel

CGI Inc 
CGI Performance
5 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in CGI Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong forward indicators, CGI is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

CGI Price Channel

Bondbloxx ETF and CGI Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bondbloxx ETF and CGI

The main advantage of trading using opposite Bondbloxx ETF and CGI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bondbloxx ETF position performs unexpectedly, CGI 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 CGI will offset losses from the drop in CGI's long position.
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The idea behind Bondbloxx ETF Trust and CGI Inc 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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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.

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