Correlation Between Blackstone Gso and Morgan Stanley

Can any of the company-specific risk be diversified away by investing in both Blackstone Gso and Morgan Stanley 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 Blackstone Gso and Morgan Stanley into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Blackstone Gso Long and Morgan Stanley Emerging, you can compare the effects of market volatilities on Blackstone Gso and Morgan Stanley 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 Blackstone Gso with a short position of Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone Gso and Morgan Stanley.

Diversification Opportunities for Blackstone Gso and Morgan Stanley

0.37

Correlation Coefficient

Blackstone Gso  Morgan Stanley

Weak diversification

The 3 months correlation between Blackstone and Morgan is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Gso Long and Morgan Stanley Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley Emerging and Blackstone Gso 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 Blackstone Gso Long are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley Emerging has no effect on the direction of Blackstone Gso i.e., Blackstone Gso and Morgan Stanley go up and down completely randomly.

Pair Corralation between Blackstone Gso and Morgan Stanley

Considering the 90-day investment horizon Blackstone Gso is expected to generate 2.21 times less return on investment than Morgan Stanley. But when comparing it to its historical volatility, Blackstone Gso Long is 1.26 times less risky than Morgan Stanley. It trades about 0.06 of its potential returns per unit of risk. Morgan Stanley Emerging is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  741.00  in Morgan Stanley Emerging on August 31, 2024 and sell it today you would earn a total of  36.00  from holding Morgan Stanley Emerging or generate 4.86% return on investment over 90 days.

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

Blackstone Gso Long  vs.  Morgan Stanley Emerging

Blackstone Gso Long

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Gso Long are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Blackstone Gso is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Morgan Stanley Emerging

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Morgan Stanley Emerging are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Morgan Stanley is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Blackstone Gso and Morgan Stanley

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

The idea behind Blackstone Gso Long and Morgan Stanley Emerging 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.