Correlation Between Blackrock Strategic and Blackrock Gbl

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

By analyzing existing cross correlation between Blackrock Strategic Global and Blackrock Gbl Lng, you can compare the effects of market volatilities on Blackrock Strategic and Blackrock Gbl 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 Strategic with a short position of Blackrock Gbl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Strategic and Blackrock Gbl.

Diversification Opportunities for Blackrock Strategic and Blackrock Gbl

-0.67

Correlation Coefficient

Blackrock Strategic  Blackrock Gbl

Excellent diversification

The 3 months correlation between Blackrock and Blackrock is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Strategic Global and Blackrock Gbl Lng in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Gbl Lng and Blackrock Strategic 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 Strategic Global are associated (or correlated) with Blackrock Gbl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Gbl Lng has no effect on the direction of Blackrock Strategic i.e., Blackrock Strategic and Blackrock Gbl go up and down completely randomly.

Pair Corralation between Blackrock Strategic and Blackrock Gbl

Assuming the 90 days horizon Blackrock Strategic Global is expected to under-perform the Blackrock Gbl. But the mutual fund apears to be less risky and, when comparing its historical volatility, Blackrock Strategic Global is 1.79 times less risky than Blackrock Gbl. The mutual fund trades about -0.06 of its potential returns per unit of risk. The Blackrock Gbl Lng is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,377  in Blackrock Gbl Lng on September 3, 2024 and sell it today you would earn a total of  33.00  from holding Blackrock Gbl Lng or generate 2.4% return on investment over 90 days.

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

Blackrock Strategic Global  vs.  Blackrock Gbl Lng

Blackrock Strategic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackrock Strategic Global has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Blackrock Strategic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Blackrock Gbl Lng

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Gbl Lng are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Blackrock Gbl is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Blackrock Strategic and Blackrock Gbl

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

The idea behind Blackrock Strategic Global and Blackrock Gbl Lng 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.