Correlation Between Smallcap Fund and Tiaa-cref Lifestyle

Can any of the company-specific risk be diversified away by investing in both Smallcap Fund and Tiaa-cref Lifestyle 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 Smallcap Fund and Tiaa-cref Lifestyle into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Smallcap Fund Fka and Tiaa Cref Lifestyle Conservative, you can compare the effects of market volatilities on Smallcap Fund and Tiaa-cref Lifestyle 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 Smallcap Fund with a short position of Tiaa-cref Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smallcap Fund and Tiaa-cref Lifestyle.

Diversification Opportunities for Smallcap Fund and Tiaa-cref Lifestyle

0.93

Correlation Coefficient

Smallcap Fund  Tiaa-cref Lifestyle

Almost no diversification

The 3 months correlation between Smallcap and Tiaa-cref is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Smallcap Fund Fka and Tiaa Cref Lifestyle Conservati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Lifestyle and Smallcap Fund 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 Smallcap Fund Fka are associated (or correlated) with Tiaa-cref Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Lifestyle has no effect on the direction of Smallcap Fund i.e., Smallcap Fund and Tiaa-cref Lifestyle go up and down completely randomly.

Pair Corralation between Smallcap Fund and Tiaa-cref Lifestyle

Assuming the 90 days horizon Smallcap Fund Fka is expected to generate 3.22 times more return on investment than Tiaa-cref Lifestyle. However, Smallcap Fund is 3.22 times more volatile than Tiaa Cref Lifestyle Conservative. It trades about 0.17 of its potential returns per unit of risk. Tiaa Cref Lifestyle Conservative is currently generating about 0.25 per unit of risk. If you would invest  2,722  in Smallcap Fund Fka on May 17, 2025 and sell it today you would earn a total of  278.00  from holding Smallcap Fund Fka or generate 10.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.39%
Values	Daily Returns

Smallcap Fund Fka  vs.  Tiaa Cref Lifestyle Conservati

Smallcap Fund Fka

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Smallcap Fund Fka are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Smallcap Fund may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Tiaa Cref Lifestyle

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Lifestyle Conservative are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Tiaa-cref Lifestyle is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Smallcap Fund and Tiaa-cref Lifestyle

The main advantage of trading using opposite Smallcap Fund and Tiaa-cref Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smallcap Fund position performs unexpectedly, Tiaa-cref Lifestyle 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 Tiaa-cref Lifestyle will offset losses from the drop in Tiaa-cref Lifestyle's long position.

The idea behind Smallcap Fund Fka and Tiaa Cref Lifestyle Conservative 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.