Correlation Between Blackstone and Golden Star
Can any of the company-specific risk be diversified away by investing in both Blackstone and Golden Star 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 Blackstone and Golden Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackstone Group and Golden Star Acquisition, you can compare the effects of market volatilities on Blackstone and Golden Star 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 Blackstone with a short position of Golden Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and Golden Star.
Diversification Opportunities for Blackstone and Golden Star
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Blackstone and Golden is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Golden Star Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Star Acquisition and Blackstone 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 Blackstone Group are associated (or correlated) with Golden Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Star Acquisition has no effect on the direction of Blackstone i.e., Blackstone and Golden Star go up and down completely randomly.
Pair Corralation between Blackstone and Golden Star
Allowing for the 90-day total investment horizon Blackstone is expected to generate 3.61 times less return on investment than Golden Star. But when comparing it to its historical volatility, Blackstone Group is 6.55 times less risky than Golden Star. It trades about 0.13 of its potential returns per unit of risk. Golden Star Acquisition is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,149 in Golden Star Acquisition on October 25, 2024 and sell it today you would earn a total of 23.00 from holding Golden Star Acquisition or generate 2.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackstone Group vs. Golden Star Acquisition
Performance |
| Timeline |
| Blackstone Group |
| Golden Star Acquisition |
Blackstone and Golden Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackstone and Golden Star
The main advantage of trading using opposite Blackstone and Golden Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone position performs unexpectedly, Golden Star 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 Golden Star will offset losses from the drop in Golden Star's long position.| Blackstone vs. MFS Investment Grade | Blackstone vs. Eaton Vance National | Blackstone vs. Nuveen California Select | Blackstone vs. Federated Premier Municipal |
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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