Correlation Between Eaton Vance and Blackrock Muniyield
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and Blackrock Muniyield 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 Eaton Vance and Blackrock Muniyield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance National and Blackrock Muniyield Quality, you can compare the effects of market volatilities on Eaton Vance and Blackrock Muniyield 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 Eaton Vance with a short position of Blackrock Muniyield. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Blackrock Muniyield.
Diversification Opportunities for Eaton Vance and Blackrock Muniyield
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eaton and Blackrock is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance National and Blackrock Muniyield Quality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Muniyield and Eaton Vance 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 Eaton Vance National are associated (or correlated) with Blackrock Muniyield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Muniyield has no effect on the direction of Eaton Vance i.e., Eaton Vance and Blackrock Muniyield go up and down completely randomly.
Pair Corralation between Eaton Vance and Blackrock Muniyield
Considering the 90-day investment horizon Eaton Vance National is expected to under-perform the Blackrock Muniyield. But the stock apears to be less risky and, when comparing its historical volatility, Eaton Vance National is 1.08 times less risky than Blackrock Muniyield. The stock trades about -0.21 of its potential returns per unit of risk. The Blackrock Muniyield Quality is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,031 in Blackrock Muniyield Quality on August 28, 2024 and sell it today you would earn a total of 9.00 from holding Blackrock Muniyield Quality or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance National vs. Blackrock Muniyield Quality
Performance |
| Timeline |
| Eaton Vance National |
| Blackrock Muniyield |
Eaton Vance and Blackrock Muniyield Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Blackrock Muniyield
The main advantage of trading using opposite Eaton Vance and Blackrock Muniyield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, Blackrock Muniyield 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 Blackrock Muniyield will offset losses from the drop in Blackrock Muniyield's long position.| Eaton Vance vs. PowerUp Acquisition Corp | Eaton Vance vs. Aurora Innovation | Eaton Vance vs. HUMANA INC | Eaton Vance vs. Aquagold International |
| Blackrock Muniyield vs. John Hancock Income | Blackrock Muniyield vs. MFS High Income | Blackrock Muniyield vs. MFS Investment Grade | Blackrock Muniyield vs. Blackrock Muniholdings Closed |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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