Correlation Between Blackrock and Payden Strategic
Can any of the company-specific risk be diversified away by investing in both Blackrock and Payden Strategic 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 and Payden Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Government Bond and Payden Strategic Income, you can compare the effects of market volatilities on Blackrock and Payden Strategic 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 with a short position of Payden Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock and Payden Strategic.
Diversification Opportunities for Blackrock and Payden Strategic
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Blackrock and Payden is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Government Bond and Payden Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Strategic Income and Blackrock 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 Government Bond are associated (or correlated) with Payden Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Strategic Income has no effect on the direction of Blackrock i.e., Blackrock and Payden Strategic go up and down completely randomly.
Pair Corralation between Blackrock and Payden Strategic
Assuming the 90 days horizon Blackrock Government Bond is expected to generate 2.15 times more return on investment than Payden Strategic. However, Blackrock is 2.15 times more volatile than Payden Strategic Income. It trades about 0.34 of its potential returns per unit of risk. Payden Strategic Income is currently generating about 0.25 per unit of risk. If you would invest 897.00 in Blackrock Government Bond on December 1, 2024 and sell it today you would earn a total of 21.00 from holding Blackrock Government Bond or generate 2.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Blackrock Government Bond vs. Payden Strategic Income
Performance |
| Timeline |
| Blackrock Government Bond |
| Payden Strategic Income |
Blackrock and Payden Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock and Payden Strategic
The main advantage of trading using opposite Blackrock and Payden Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock position performs unexpectedly, Payden Strategic 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 Strategic will offset losses from the drop in Payden Strategic's long position.| Blackrock vs. Blackrock Global Longshort | Blackrock vs. Ashmore Emerging Markets | Blackrock vs. Transamerica Short Term Bond | Blackrock vs. Siit Ultra Short |
| Payden Strategic vs. Prudential Financial Services | Payden Strategic vs. Icon Financial Fund | Payden Strategic vs. Gabelli Global Financial | Payden Strategic vs. Financials Ultrasector Profund |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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