Correlation Between Blackrock International and Meridian Small
Can any of the company-specific risk be diversified away by investing in both Blackrock International and Meridian Small 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 International and Meridian Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock International Index and Meridian Small Cap, you can compare the effects of market volatilities on Blackrock International and Meridian Small 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 International with a short position of Meridian Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock International and Meridian Small.
Diversification Opportunities for Blackrock International and Meridian Small
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Blackrock and Meridian is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock International Index and Meridian Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meridian Small Cap and Blackrock International 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 International Index are associated (or correlated) with Meridian Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meridian Small Cap has no effect on the direction of Blackrock International i.e., Blackrock International and Meridian Small go up and down completely randomly.
Pair Corralation between Blackrock International and Meridian Small
Assuming the 90 days horizon Blackrock International Index is expected to under-perform the Meridian Small. But the mutual fund apears to be less risky and, when comparing its historical volatility, Blackrock International Index is 1.53 times less risky than Meridian Small. The mutual fund trades about -0.18 of its potential returns per unit of risk. The Meridian Small Cap is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 1,344 in Meridian Small Cap on August 29, 2024 and sell it today you would earn a total of 97.00 from holding Meridian Small Cap or generate 7.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock International Index vs. Meridian Small Cap
Performance |
| Timeline |
| Blackrock International |
| Meridian Small Cap |
Blackrock International and Meridian Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock International and Meridian Small
The main advantage of trading using opposite Blackrock International and Meridian Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock International position performs unexpectedly, Meridian Small 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 Meridian Small will offset losses from the drop in Meridian Small's long position.| Blackrock International vs. Blackrock Midcap Index | Blackrock International vs. Blackrock Small Cap | Blackrock International vs. State Street Equity | Blackrock International vs. T Rowe Price |
| Meridian Small vs. T Rowe Price | Meridian Small vs. Diamond Hill Large | Meridian Small vs. Meridian Small Cap | Meridian Small vs. Wilmington Large Cap Strategy |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |