Correlation Between Blackrock Managed and Touchstone Premium
Can any of the company-specific risk be diversified away by investing in both Blackrock Managed and Touchstone Premium 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 Managed and Touchstone Premium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Managed Income and Touchstone Premium Yield, you can compare the effects of market volatilities on Blackrock Managed and Touchstone Premium 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 Managed with a short position of Touchstone Premium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Managed and Touchstone Premium.
Diversification Opportunities for Blackrock Managed and Touchstone Premium
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Blackrock and Touchstone is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Managed Income and Touchstone Premium Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Premium Yield and Blackrock Managed 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 Managed Income are associated (or correlated) with Touchstone Premium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Premium Yield has no effect on the direction of Blackrock Managed i.e., Blackrock Managed and Touchstone Premium go up and down completely randomly.
Pair Corralation between Blackrock Managed and Touchstone Premium
Assuming the 90 days horizon Blackrock Managed is expected to generate 2.18 times less return on investment than Touchstone Premium. But when comparing it to its historical volatility, Blackrock Managed Income is 2.46 times less risky than Touchstone Premium. It trades about 0.25 of its potential returns per unit of risk. Touchstone Premium Yield is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 870.00 in Touchstone Premium Yield on September 3, 2024 and sell it today you would earn a total of 24.00 from holding Touchstone Premium Yield or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Managed Income vs. Touchstone Premium Yield
Performance |
| Timeline |
| Blackrock Managed Income |
| Touchstone Premium Yield |
Blackrock Managed and Touchstone Premium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Managed and Touchstone Premium
The main advantage of trading using opposite Blackrock Managed and Touchstone Premium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Managed position performs unexpectedly, Touchstone Premium 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 Touchstone Premium will offset losses from the drop in Touchstone Premium's long position.| Blackrock Managed vs. Tax Managed Mid Small | Blackrock Managed vs. Davenport Small Cap | Blackrock Managed vs. Northern Small Cap | Blackrock Managed vs. Small Cap Stock |
| Touchstone Premium vs. Dodge Cox Emerging | Touchstone Premium vs. Jpmorgan Emerging Markets | Touchstone Premium vs. Templeton Emerging Markets | Touchstone Premium vs. Legg Mason Partners |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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