Correlation Between Blackstone and SiriusPoint
Can any of the company-specific risk be diversified away by investing in both Blackstone and SiriusPoint 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 SiriusPoint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackstone Group and SiriusPoint, you can compare the effects of market volatilities on Blackstone and SiriusPoint 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 SiriusPoint. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and SiriusPoint.
Diversification Opportunities for Blackstone and SiriusPoint
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Blackstone and SiriusPoint is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and SiriusPoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SiriusPoint 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 SiriusPoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SiriusPoint has no effect on the direction of Blackstone i.e., Blackstone and SiriusPoint go up and down completely randomly.
Pair Corralation between Blackstone and SiriusPoint
Allowing for the 90-day total investment horizon Blackstone Group is expected to generate 2.55 times more return on investment than SiriusPoint. However, Blackstone is 2.55 times more volatile than SiriusPoint. It trades about 0.1 of its potential returns per unit of risk. SiriusPoint is currently generating about 0.06 per unit of risk. If you would invest 7,389 in Blackstone Group on August 30, 2024 and sell it today you would earn a total of 11,513 from holding Blackstone Group or generate 155.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackstone Group vs. SiriusPoint
Performance |
| Timeline |
| Blackstone Group |
| SiriusPoint |
Blackstone and SiriusPoint Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackstone and SiriusPoint
The main advantage of trading using opposite Blackstone and SiriusPoint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone position performs unexpectedly, SiriusPoint 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 SiriusPoint will offset losses from the drop in SiriusPoint's long position.The idea behind Blackstone Group and SiriusPoint 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.| SiriusPoint vs. RLJ Lodging Trust | SiriusPoint vs. Argo Group International | SiriusPoint vs. New York Mortgage | SiriusPoint vs. HUMANA INC |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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