Correlation Between BLZ and DENT

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both BLZ and DENT 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 BLZ and DENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BLZ and DENT, you can compare the effects of market volatilities on BLZ and DENT 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 BLZ with a short position of DENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of BLZ and DENT.

Diversification Opportunities for BLZ and DENT

BLZDENTDiversified AwayBLZDENTDiversified Away100%
0.8
  Correlation Coefficient

Very poor diversification

The 3 months correlation between BLZ and DENT is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding BLZ and DENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DENT and BLZ 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 BLZ are associated (or correlated) with DENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DENT has no effect on the direction of BLZ i.e., BLZ and DENT go up and down completely randomly.

Pair Corralation between BLZ and DENT

Assuming the 90 days trading horizon BLZ is expected to generate 0.95 times more return on investment than DENT. However, BLZ is 1.06 times less risky than DENT. It trades about -0.15 of its potential returns per unit of risk. DENT is currently generating about -0.16 per unit of risk. If you would invest  5.00  in BLZ on November 23, 2024 and sell it today you would lose (1.13) from holding BLZ or give up 22.6% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

BLZ  vs.  DENT

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -50050
JavaScript chart by amCharts 3.21.15BLZ DENT
       Timeline  
BLZ 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days BLZ has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's basic indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for BLZ shareholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.040.060.080.10.120.140.160.180.2
DENT 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days DENT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for DENT shareholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.00080.0010.00120.00140.00160.00180.002

BLZ and DENT Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-14.53-10.88-7.23-3.59-0.0522.966.089.212.3215.44 0.00550.00600.0065
JavaScript chart by amCharts 3.21.15BLZ DENT
       Returns  

Pair Trading with BLZ and DENT

The main advantage of trading using opposite BLZ and DENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BLZ position performs unexpectedly, DENT 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 DENT will offset losses from the drop in DENT's long position.
The idea behind BLZ and DENT pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

Other Complementary Tools

Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Transaction History
View history of all your transactions and understand their impact on performance
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk