Correlation Between Alliancebernstein and Blackrock Muniassets
Can any of the company-specific risk be diversified away by investing in both Alliancebernstein and Blackrock Muniassets 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 Alliancebernstein and Blackrock Muniassets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alliancebernstein Global High and Blackrock Muniassets, you can compare the effects of market volatilities on Alliancebernstein and Blackrock Muniassets 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 Alliancebernstein with a short position of Blackrock Muniassets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliancebernstein and Blackrock Muniassets.
Diversification Opportunities for Alliancebernstein and Blackrock Muniassets
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alliancebernstein and Blackrock is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Alliancebernstein Global High and Blackrock Muniassets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Muniassets and Alliancebernstein 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 Alliancebernstein Global High are associated (or correlated) with Blackrock Muniassets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Muniassets has no effect on the direction of Alliancebernstein i.e., Alliancebernstein and Blackrock Muniassets go up and down completely randomly.
Pair Corralation between Alliancebernstein and Blackrock Muniassets
Considering the 90-day investment horizon Alliancebernstein is expected to generate 2.82 times less return on investment than Blackrock Muniassets. In addition to that, Alliancebernstein is 1.55 times more volatile than Blackrock Muniassets. It trades about 0.07 of its total potential returns per unit of risk. Blackrock Muniassets is currently generating about 0.32 per unit of volatility. If you would invest 1,180 in Blackrock Muniassets on September 14, 2024 and sell it today you would earn a total of 19.00 from holding Blackrock Muniassets or generate 1.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alliancebernstein Global High vs. Blackrock Muniassets
Performance |
| Timeline |
| Alliancebernstein |
| Blackrock Muniassets |
Alliancebernstein and Blackrock Muniassets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliancebernstein and Blackrock Muniassets
The main advantage of trading using opposite Alliancebernstein and Blackrock Muniassets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliancebernstein position performs unexpectedly, Blackrock Muniassets 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 Muniassets will offset losses from the drop in Blackrock Muniassets' long position.| Alliancebernstein vs. Western Asset High | Alliancebernstein vs. Blackrock Debt Strategies | Alliancebernstein vs. Western Asset Diversified | Alliancebernstein vs. Western Asset Global |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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