Correlation Between Blackstone and Willis Towers
Can any of the company-specific risk be diversified away by investing in both Blackstone and Willis Towers 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 Willis Towers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackstone Group and Willis Towers Watson, you can compare the effects of market volatilities on Blackstone and Willis Towers 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 Willis Towers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and Willis Towers.
Diversification Opportunities for Blackstone and Willis Towers
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Blackstone and Willis is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Willis Towers Watson in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Willis Towers Watson 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 Willis Towers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Willis Towers Watson has no effect on the direction of Blackstone i.e., Blackstone and Willis Towers go up and down completely randomly.
Pair Corralation between Blackstone and Willis Towers
Allowing for the 90-day total investment horizon Blackstone Group is expected to generate 1.42 times more return on investment than Willis Towers. However, Blackstone is 1.42 times more volatile than Willis Towers Watson. It trades about 0.45 of its potential returns per unit of risk. Willis Towers Watson is currently generating about 0.3 per unit of risk. If you would invest 16,997 in Blackstone Group on August 27, 2024 and sell it today you would earn a total of 2,908 from holding Blackstone Group or generate 17.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackstone Group vs. Willis Towers Watson
Performance |
| Timeline |
| Blackstone Group |
| Willis Towers Watson |
Blackstone and Willis Towers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackstone and Willis Towers
The main advantage of trading using opposite Blackstone and Willis Towers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone position performs unexpectedly, Willis Towers 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 Willis Towers will offset losses from the drop in Willis Towers' long position.| Blackstone vs. PowerUp Acquisition Corp | Blackstone vs. Aurora Innovation | Blackstone vs. HUMANA INC | Blackstone vs. Aquagold International |
| Willis Towers vs. Marsh McLennan Companies | Willis Towers vs. Arthur J Gallagher | Willis Towers vs. Brown Brown | Willis Towers vs. Erie Indemnity |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |