Correlation Between Bridge Builder and Guggenheim High

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

By analyzing existing cross correlation between Bridge Builder Large and Guggenheim High Yield, you can compare the effects of market volatilities on Bridge Builder and Guggenheim High 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 Bridge Builder with a short position of Guggenheim High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridge Builder and Guggenheim High.

Diversification Opportunities for Bridge Builder and Guggenheim High

0.97

Correlation Coefficient

Bridge Builder  Guggenheim High

Almost no diversification

The 3 months correlation between Bridge and Guggenheim is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Bridge Builder Large and Guggenheim High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim High Yield and Bridge Builder 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 Bridge Builder Large are associated (or correlated) with Guggenheim High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim High Yield has no effect on the direction of Bridge Builder i.e., Bridge Builder and Guggenheim High go up and down completely randomly.

Pair Corralation between Bridge Builder and Guggenheim High

Assuming the 90 days horizon Bridge Builder Large is expected to generate 4.64 times more return on investment than Guggenheim High. However, Bridge Builder is 4.64 times more volatile than Guggenheim High Yield. It trades about 0.22 of its potential returns per unit of risk. Guggenheim High Yield is currently generating about 0.27 per unit of risk. If you would invest  2,411  in Bridge Builder Large on May 6, 2025 and sell it today you would earn a total of  274.00  from holding Bridge Builder Large or generate 11.36% return on investment over 90 days.

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

Bridge Builder Large  vs.  Guggenheim High Yield

Bridge Builder Large

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bridge Builder Large are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak essential indicators, Bridge Builder may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Guggenheim High Yield

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim High Yield are ranked lower than 21 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Guggenheim High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bridge Builder and Guggenheim High

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

The idea behind Bridge Builder Large and Guggenheim High Yield 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.