Correlation Between BlackRock Capital and Bain Capital
Can any of the company-specific risk be diversified away by investing in both BlackRock Capital and Bain Capital 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 Capital and Bain Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock Capital Allocation and Bain Capital Specialty, you can compare the effects of market volatilities on BlackRock Capital and Bain Capital 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 Capital with a short position of Bain Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock Capital and Bain Capital.
Diversification Opportunities for BlackRock Capital and Bain Capital
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BlackRock and Bain is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock Capital Allocation and Bain Capital Specialty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bain Capital Specialty and BlackRock Capital 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 Capital Allocation are associated (or correlated) with Bain Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bain Capital Specialty has no effect on the direction of BlackRock Capital i.e., BlackRock Capital and Bain Capital go up and down completely randomly.
Pair Corralation between BlackRock Capital and Bain Capital
Given the investment horizon of 90 days BlackRock Capital is expected to generate 1.31 times less return on investment than Bain Capital. But when comparing it to its historical volatility, BlackRock Capital Allocation is 1.34 times less risky than Bain Capital. It trades about 0.09 of its potential returns per unit of risk. Bain Capital Specialty is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,033 in Bain Capital Specialty on August 28, 2024 and sell it today you would earn a total of 648.00 from holding Bain Capital Specialty or generate 62.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock Capital Allocation vs. Bain Capital Specialty
Performance |
| Timeline |
| BlackRock Capital |
| Bain Capital Specialty |
BlackRock Capital and Bain Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock Capital and Bain Capital
The main advantage of trading using opposite BlackRock Capital and Bain Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock Capital position performs unexpectedly, Bain Capital 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 Bain Capital will offset losses from the drop in Bain Capital's long position.| BlackRock Capital vs. Doubleline Yield Opportunities | BlackRock Capital vs. PIMCO Access Income | BlackRock Capital vs. Blackrock Innovation Growth | BlackRock Capital vs. Cohen Steers Tax Advantaged |
| Bain Capital vs. BlackRock TCP Capital | Bain Capital vs. Triplepoint Venture Growth | Bain Capital vs. Sixth Street Specialty | Bain Capital vs. Golub Capital BDC |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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