Correlation Between Blackstone Minerals and Metals X

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

By analyzing existing cross correlation between Blackstone Minerals and Metals X Limited, you can compare the effects of market volatilities on Blackstone Minerals and Metals X 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 Minerals with a short position of Metals X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone Minerals and Metals X.

Diversification Opportunities for Blackstone Minerals and Metals X

0.47

Correlation Coefficient

Blackstone Minerals  Metals X

Very weak diversification

The 3 months correlation between Blackstone and Metals is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Minerals and Metals X Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metals X Limited and Blackstone Minerals 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 Minerals are associated (or correlated) with Metals X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metals X Limited has no effect on the direction of Blackstone Minerals i.e., Blackstone Minerals and Metals X go up and down completely randomly.

Pair Corralation between Blackstone Minerals and Metals X

Assuming the 90 days horizon Blackstone Minerals is expected to generate 22.56 times more return on investment than Metals X. However, Blackstone Minerals is 22.56 times more volatile than Metals X Limited. It trades about 0.16 of its potential returns per unit of risk. Metals X Limited is currently generating about -0.04 per unit of risk. If you would invest  0.01  in Blackstone Minerals on September 22, 2024 and sell it today you would earn a total of  1.49  from holding Blackstone Minerals or generate 14900.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Blackstone Minerals  vs.  Metals X Limited

Blackstone Minerals

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Minerals are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, Blackstone Minerals reported solid returns over the last few months and may actually be approaching a breakup point.

Metals X Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Metals X Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Blackstone Minerals and Metals X

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

The idea behind Blackstone Minerals and Metals X Limited 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 Global Correlations module to find global opportunities by holding instruments from different markets.