Correlation Between BlackRock and BBX Capital
Can any of the company-specific risk be diversified away by investing in both BlackRock and BBX 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 and BBX Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock and BBX Capital, you can compare the effects of market volatilities on BlackRock and BBX 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 with a short position of BBX Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock and BBX Capital.
Diversification Opportunities for BlackRock and BBX Capital
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BlackRock and BBX is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock and BBX Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BBX Capital 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 are associated (or correlated) with BBX Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BBX Capital has no effect on the direction of BlackRock i.e., BlackRock and BBX Capital go up and down completely randomly.
Pair Corralation between BlackRock and BBX Capital
Considering the 90-day investment horizon BlackRock is expected to generate 2.71 times more return on investment than BBX Capital. However, BlackRock is 2.71 times more volatile than BBX Capital. It trades about 0.21 of its potential returns per unit of risk. BBX Capital is currently generating about -0.1 per unit of risk. If you would invest 98,622 in BlackRock on August 28, 2024 and sell it today you would earn a total of 4,527 from holding BlackRock or generate 4.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock vs. BBX Capital
Performance |
| Timeline |
| BlackRock |
| BBX Capital |
BlackRock and BBX Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock and BBX Capital
The main advantage of trading using opposite BlackRock and BBX Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock position performs unexpectedly, BBX 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 BBX Capital will offset losses from the drop in BBX Capital's long position.| BlackRock vs. KKR Co LP | BlackRock vs. Apollo Global Management | BlackRock vs. Brookfield Asset Management | BlackRock vs. Carlyle Group |
| BBX Capital vs. Blackstone Group | BBX Capital vs. BlackRock | BBX Capital vs. Apollo Global Management | BBX Capital vs. Bank of New |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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