Correlation Between Blackrock Multi and Guangzhou Automobile
Can any of the company-specific risk be diversified away by investing in both Blackrock Multi and Guangzhou Automobile 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 Multi and Guangzhou Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Multi Sector and Guangzhou Automobile Group, you can compare the effects of market volatilities on Blackrock Multi and Guangzhou Automobile 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 Multi with a short position of Guangzhou Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Multi and Guangzhou Automobile.
Diversification Opportunities for Blackrock Multi and Guangzhou Automobile
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Blackrock and Guangzhou is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Multi Sector and Guangzhou Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Automobile and Blackrock Multi 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 Multi Sector are associated (or correlated) with Guangzhou Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Automobile has no effect on the direction of Blackrock Multi i.e., Blackrock Multi and Guangzhou Automobile go up and down completely randomly.
Pair Corralation between Blackrock Multi and Guangzhou Automobile
Considering the 90-day investment horizon Blackrock Multi is expected to generate 20.35 times less return on investment than Guangzhou Automobile. But when comparing it to its historical volatility, Blackrock Multi Sector is 10.71 times less risky than Guangzhou Automobile. It trades about 0.12 of its potential returns per unit of risk. Guangzhou Automobile Group is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 36.00 in Guangzhou Automobile Group on November 9, 2024 and sell it today you would earn a total of 8.00 from holding Guangzhou Automobile Group or generate 22.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Blackrock Multi Sector vs. Guangzhou Automobile Group
Performance |
| Timeline |
| Blackrock Multi Sector |
| Guangzhou Automobile |
Blackrock Multi and Guangzhou Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Multi and Guangzhou Automobile
The main advantage of trading using opposite Blackrock Multi and Guangzhou Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Multi position performs unexpectedly, Guangzhou Automobile 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 Guangzhou Automobile will offset losses from the drop in Guangzhou Automobile's long position.| Blackrock Multi vs. Pimco Corporate Income | Blackrock Multi vs. BlackRock Limited Duration | Blackrock Multi vs. BlackRock Core Bond | Blackrock Multi vs. Blackrock Muniholdings Closed |
| Guangzhou Automobile vs. Great Wall Motor | Guangzhou Automobile vs. Dongfeng Group | Guangzhou Automobile vs. Great Wall Motor | Guangzhou Automobile vs. BAIC Motor |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |