Correlation Between Blackstone and Patria Latin
Can any of the company-specific risk be diversified away by investing in both Blackstone and Patria Latin 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 Patria Latin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackstone Group and Patria Latin American, you can compare the effects of market volatilities on Blackstone and Patria Latin 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 Patria Latin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and Patria Latin.
Diversification Opportunities for Blackstone and Patria Latin
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Blackstone and Patria is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Patria Latin American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Patria Latin American 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 Patria Latin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Patria Latin American has no effect on the direction of Blackstone i.e., Blackstone and Patria Latin go up and down completely randomly.
Pair Corralation between Blackstone and Patria Latin
Allowing for the 90-day total investment horizon Blackstone Group is expected to generate 8.81 times more return on investment than Patria Latin. However, Blackstone is 8.81 times more volatile than Patria Latin American. It trades about 0.12 of its potential returns per unit of risk. Patria Latin American is currently generating about 0.1 per unit of risk. If you would invest 9,945 in Blackstone Group on August 26, 2024 and sell it today you would earn a total of 9,456 from holding Blackstone Group or generate 95.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackstone Group vs. Patria Latin American
Performance |
| Timeline |
| Blackstone Group |
| Patria Latin American |
Blackstone and Patria Latin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackstone and Patria Latin
The main advantage of trading using opposite Blackstone and Patria Latin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone position performs unexpectedly, Patria Latin 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 Patria Latin will offset losses from the drop in Patria Latin's long position.| Blackstone vs. PowerUp Acquisition Corp | Blackstone vs. Aurora Innovation | Blackstone vs. HUMANA INC | Blackstone vs. Aquagold International |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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