Correlation Between Blackrock Enhanced and Cion Investment

Can any of the company-specific risk be diversified away by investing in both Blackrock Enhanced and Cion Investment 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 Blackrock Enhanced and Cion Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Blackrock Enhanced Equity and Cion Investment Corp, you can compare the effects of market volatilities on Blackrock Enhanced and Cion Investment 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 Blackrock Enhanced with a short position of Cion Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Enhanced and Cion Investment.

Diversification Opportunities for Blackrock Enhanced and Cion Investment

-0.25

Correlation Coefficient

Blackrock Enhanced  Cion Investment

Very good diversification

The 3 months correlation between Blackrock and Cion is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Enhanced Equity and Cion Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cion Investment Corp and Blackrock Enhanced 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 Blackrock Enhanced Equity are associated (or correlated) with Cion Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cion Investment Corp has no effect on the direction of Blackrock Enhanced i.e., Blackrock Enhanced and Cion Investment go up and down completely randomly.

Pair Corralation between Blackrock Enhanced and Cion Investment

Considering the 90-day investment horizon Blackrock Enhanced Equity is expected to generate 0.8 times more return on investment than Cion Investment. However, Blackrock Enhanced Equity is 1.25 times less risky than Cion Investment. It trades about 0.12 of its potential returns per unit of risk. Cion Investment Corp is currently generating about 0.05 per unit of risk. If you would invest  823.00  in Blackrock Enhanced Equity on September 12, 2024 and sell it today you would earn a total of  50.00  from holding Blackrock Enhanced Equity or generate 6.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Blackrock Enhanced Equity  vs.  Cion Investment Corp

Blackrock Enhanced Equity

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Enhanced Equity are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. Even with relatively steady fundamental indicators, Blackrock Enhanced is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Cion Investment Corp

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cion Investment Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Cion Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Blackrock Enhanced and Cion Investment

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

The idea behind Blackrock Enhanced Equity and Cion Investment Corp 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.