Correlation Between BlackRock Science and IQ MacKay
Can any of the company-specific risk be diversified away by investing in both BlackRock Science and IQ MacKay 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 Science and IQ MacKay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock Science Tech and IQ MacKay Municipal, you can compare the effects of market volatilities on BlackRock Science and IQ MacKay 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 Science with a short position of IQ MacKay. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock Science and IQ MacKay.
Diversification Opportunities for BlackRock Science and IQ MacKay
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BlackRock and MMIN is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock Science Tech and IQ MacKay Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQ MacKay Municipal and BlackRock Science 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 Science Tech are associated (or correlated) with IQ MacKay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQ MacKay Municipal has no effect on the direction of BlackRock Science i.e., BlackRock Science and IQ MacKay go up and down completely randomly.
Pair Corralation between BlackRock Science and IQ MacKay
Considering the 90-day investment horizon BlackRock Science is expected to generate 1.24 times less return on investment than IQ MacKay. In addition to that, BlackRock Science is 2.28 times more volatile than IQ MacKay Municipal. It trades about 0.05 of its total potential returns per unit of risk. IQ MacKay Municipal is currently generating about 0.14 per unit of volatility. If you would invest 2,390 in IQ MacKay Municipal on August 24, 2024 and sell it today you would earn a total of 32.00 from holding IQ MacKay Municipal or generate 1.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock Science Tech vs. IQ MacKay Municipal
Performance |
| Timeline |
| BlackRock Science Tech |
| IQ MacKay Municipal |
BlackRock Science and IQ MacKay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock Science and IQ MacKay
The main advantage of trading using opposite BlackRock Science and IQ MacKay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock Science position performs unexpectedly, IQ MacKay 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 IQ MacKay will offset losses from the drop in IQ MacKay's long position.| BlackRock Science vs. MFS Investment Grade | BlackRock Science vs. Invesco High Income | BlackRock Science vs. Eaton Vance National | BlackRock Science vs. Nuveen California Select |
| IQ MacKay vs. IQ MacKay Municipal | IQ MacKay vs. Franklin Liberty Federal | IQ MacKay vs. Columbia Multi Sector Municipal | IQ MacKay vs. Hartford Municipal Opportunities |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |