Correlation Between Tiaa-cref Lifecycle and Bridge Builder

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

By analyzing existing cross correlation between Tiaa Cref Lifecycle 2050 and Bridge Builder E, you can compare the effects of market volatilities on Tiaa-cref Lifecycle and Bridge Builder 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 Tiaa-cref Lifecycle with a short position of Bridge Builder. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tiaa-cref Lifecycle and Bridge Builder.

Diversification Opportunities for Tiaa-cref Lifecycle and Bridge Builder

0.76

Correlation Coefficient

Tiaa-cref Lifecycle  Bridge Builder

Poor diversification

The 3 months correlation between Tiaa-cref and Bridge is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref Lifecycle 2050 and Bridge Builder E in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridge Builder E and Tiaa-cref Lifecycle 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 Tiaa Cref Lifecycle 2050 are associated (or correlated) with Bridge Builder. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridge Builder E has no effect on the direction of Tiaa-cref Lifecycle i.e., Tiaa-cref Lifecycle and Bridge Builder go up and down completely randomly.

Pair Corralation between Tiaa-cref Lifecycle and Bridge Builder

Assuming the 90 days horizon Tiaa Cref Lifecycle 2050 is expected to generate 1.99 times more return on investment than Bridge Builder. However, Tiaa-cref Lifecycle is 1.99 times more volatile than Bridge Builder E. It trades about 0.35 of its potential returns per unit of risk. Bridge Builder E is currently generating about 0.13 per unit of risk. If you would invest  1,387  in Tiaa Cref Lifecycle 2050 on April 23, 2025 and sell it today you would earn a total of  199.00  from holding Tiaa Cref Lifecycle 2050 or generate 14.35% return on investment over 90 days.

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

Tiaa Cref Lifecycle 2050  vs.  Bridge Builder E

Tiaa Cref Lifecycle

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Lifecycle 2050 are ranked lower than 27 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Tiaa-cref Lifecycle showed solid returns over the last few months and may actually be approaching a breakup point.

Bridge Builder E

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bridge Builder E are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Bridge Builder is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Tiaa-cref Lifecycle and Bridge Builder

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

The idea behind Tiaa Cref Lifecycle 2050 and Bridge Builder E 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.