Correlation Between Tiaa-cref Bond and Tiaa-cref Equity

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

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

Diversification Opportunities for Tiaa-cref Bond and Tiaa-cref Equity

0.87

Correlation Coefficient

Tiaa-cref Bond  Tiaa-cref Equity

Very poor diversification

The 3 months correlation between Tiaa-cref and Tiaa-cref is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref Bond Fund and Tiaa Cref Equity Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Equity and Tiaa-cref Bond 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 Bond Fund are associated (or correlated) with Tiaa-cref Equity. 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 Equity has no effect on the direction of Tiaa-cref Bond i.e., Tiaa-cref Bond and Tiaa-cref Equity go up and down completely randomly.

Pair Corralation between Tiaa-cref Bond and Tiaa-cref Equity

Assuming the 90 days horizon Tiaa-cref Bond is expected to generate 4.57 times less return on investment than Tiaa-cref Equity. But when comparing it to its historical volatility, Tiaa Cref Bond Fund is 3.34 times less risky than Tiaa-cref Equity. It trades about 0.15 of its potential returns per unit of risk. Tiaa Cref Equity Index is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  4,408  in Tiaa Cref Equity Index on August 5, 2025 and sell it today you would earn a total of  383.00  from holding Tiaa Cref Equity Index or generate 8.69% return on investment over 90 days.

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

Tiaa Cref Bond Fund  vs.  Tiaa Cref Equity Index

Tiaa Cref Bond

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Bond Fund are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Tiaa-cref Bond is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Tiaa Cref Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Equity Index are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Tiaa-cref Equity may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Pair Trading with Tiaa-cref Bond and Tiaa-cref Equity

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

The idea behind Tiaa Cref Bond Fund and Tiaa Cref Equity Index 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.