Correlation Between Dynex Capital and Blackstone
Can any of the company-specific risk be diversified away by investing in both Dynex Capital and Blackstone 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 Dynex Capital and Blackstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynex Capital and Blackstone Group, you can compare the effects of market volatilities on Dynex Capital and Blackstone 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 Dynex Capital with a short position of Blackstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynex Capital and Blackstone.
Diversification Opportunities for Dynex Capital and Blackstone
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dynex and Blackstone is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Dynex Capital and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group and Dynex Capital 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 Dynex Capital are associated (or correlated) with Blackstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Group has no effect on the direction of Dynex Capital i.e., Dynex Capital and Blackstone go up and down completely randomly.
Pair Corralation between Dynex Capital and Blackstone
Allowing for the 90-day total investment horizon Dynex Capital is expected to generate 16.04 times less return on investment than Blackstone. But when comparing it to its historical volatility, Dynex Capital is 1.98 times less risky than Blackstone. It trades about 0.06 of its potential returns per unit of risk. Blackstone Group is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest 16,664 in Blackstone Group on August 26, 2024 and sell it today you would earn a total of 3,241 from holding Blackstone Group or generate 19.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dynex Capital vs. Blackstone Group
Performance |
| Timeline |
| Dynex Capital |
| Blackstone Group |
Dynex Capital and Blackstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynex Capital and Blackstone
The main advantage of trading using opposite Dynex Capital and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynex Capital position performs unexpectedly, Blackstone 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 Blackstone will offset losses from the drop in Blackstone's long position.| Dynex Capital vs. Ellington Residential Mortgage | Dynex Capital vs. Orchid Island Capital | Dynex Capital vs. ARMOUR Residential REIT | Dynex Capital vs. Ellington Financial |
| 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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