Correlation Between Blackrock High and Payden Regal
Can any of the company-specific risk be diversified away by investing in both Blackrock High and Payden Regal 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 High and Payden Regal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock High Yield and The Payden Regal, you can compare the effects of market volatilities on Blackrock High and Payden Regal 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 High with a short position of Payden Regal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock High and Payden Regal.
Diversification Opportunities for Blackrock High and Payden Regal
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Blackrock and Payden is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock High Yield and The Payden Regal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Regal and Blackrock High 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 High Yield are associated (or correlated) with Payden Regal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Regal has no effect on the direction of Blackrock High i.e., Blackrock High and Payden Regal go up and down completely randomly.
Pair Corralation between Blackrock High and Payden Regal
Assuming the 90 days horizon Blackrock High Yield is expected to generate 1.11 times more return on investment than Payden Regal. However, Blackrock High is 1.11 times more volatile than The Payden Regal. It trades about 0.2 of its potential returns per unit of risk. The Payden Regal is currently generating about 0.21 per unit of risk. If you would invest 643.00 in Blackrock High Yield on September 4, 2024 and sell it today you would earn a total of 77.00 from holding Blackrock High Yield or generate 11.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock High Yield vs. The Payden Regal
Performance |
| Timeline |
| Blackrock High Yield |
| Payden Regal |
Blackrock High and Payden Regal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock High and Payden Regal
The main advantage of trading using opposite Blackrock High and Payden Regal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock High position performs unexpectedly, Payden Regal 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 Payden Regal will offset losses from the drop in Payden Regal's long position.| Blackrock High vs. Blackrock California Municipal | Blackrock High vs. Blackrock Balanced Capital | Blackrock High vs. Blackrock Eurofund Class | Blackrock High vs. Blackrock Funds |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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