Correlation Between Neometals and Blackstone Loan

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

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

Diversification Opportunities for Neometals and Blackstone Loan

-0.16

Correlation Coefficient

Neometals  Blackstone Loan

Good diversification

The 3 months correlation between Neometals and Blackstone is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Neometals and Blackstone Loan Financing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Loan Financing and Neometals 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 Neometals are associated (or correlated) with Blackstone Loan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Loan Financing has no effect on the direction of Neometals i.e., Neometals and Blackstone Loan go up and down completely randomly.

Pair Corralation between Neometals and Blackstone Loan

Assuming the 90 days trading horizon Neometals is expected to under-perform the Blackstone Loan. In addition to that, Neometals is 4.14 times more volatile than Blackstone Loan Financing. It trades about -0.02 of its total potential returns per unit of risk. Blackstone Loan Financing is currently generating about 0.18 per unit of volatility. If you would invest  5,698  in Blackstone Loan Financing on August 31, 2024 and sell it today you would earn a total of  802.00  from holding Blackstone Loan Financing or generate 14.08% return on investment over 90 days.

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

Neometals  vs.  Blackstone Loan Financing

Neometals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Neometals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Blackstone Loan Financing

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Loan Financing are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Blackstone Loan unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Neometals and Blackstone Loan

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

The idea behind Neometals and Blackstone Loan Financing 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.