Correlation Between Fresenius Medical and Blackstone Loan
Can any of the company-specific risk be diversified away by investing in both Fresenius Medical 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 Fresenius Medical and Blackstone Loan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fresenius Medical Care and Blackstone Loan Financing, you can compare the effects of market volatilities on Fresenius Medical 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 Fresenius Medical with a short position of Blackstone Loan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresenius Medical and Blackstone Loan.
Diversification Opportunities for Fresenius Medical and Blackstone Loan
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fresenius and Blackstone is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Fresenius Medical Care 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 Fresenius Medical 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 Fresenius Medical Care 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 Fresenius Medical i.e., Fresenius Medical and Blackstone Loan go up and down completely randomly.
Pair Corralation between Fresenius Medical and Blackstone Loan
Assuming the 90 days trading horizon Fresenius Medical Care is expected to generate 0.77 times more return on investment than Blackstone Loan. However, Fresenius Medical Care is 1.29 times less risky than Blackstone Loan. It trades about 0.38 of its potential returns per unit of risk. Blackstone Loan Financing is currently generating about 0.29 per unit of risk. If you would invest 3,656 in Fresenius Medical Care on September 2, 2024 and sell it today you would earn a total of 495.00 from holding Fresenius Medical Care or generate 13.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fresenius Medical Care vs. Blackstone Loan Financing
Performance |
| Timeline |
| Fresenius Medical Care |
| Blackstone Loan Financing |
Fresenius Medical and Blackstone Loan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fresenius Medical and Blackstone Loan
The main advantage of trading using opposite Fresenius Medical and Blackstone Loan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fresenius Medical 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.| Fresenius Medical vs. Uniper SE | Fresenius Medical vs. Mulberry Group PLC | Fresenius Medical vs. London Security Plc | Fresenius Medical vs. Triad Group PLC |
| Blackstone Loan vs. Fulcrum Metals PLC | Blackstone Loan vs. Alliance Data Systems | Blackstone Loan vs. European Metals Holdings | Blackstone Loan vs. Empire Metals Limited |
Check out your portfolio center.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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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