Correlation Between Regional Bank and Blackrock Inflation
Can any of the company-specific risk be diversified away by investing in both Regional Bank and Blackrock Inflation 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 Regional Bank and Blackrock Inflation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regional Bank Fund and Blackrock Inflation Protected, you can compare the effects of market volatilities on Regional Bank and Blackrock Inflation 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 Regional Bank with a short position of Blackrock Inflation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regional Bank and Blackrock Inflation.
Diversification Opportunities for Regional Bank and Blackrock Inflation
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Regional and Blackrock is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Regional Bank Fund and Blackrock Inflation Protected in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Inflation and Regional Bank 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 Regional Bank Fund are associated (or correlated) with Blackrock Inflation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Inflation has no effect on the direction of Regional Bank i.e., Regional Bank and Blackrock Inflation go up and down completely randomly.
Pair Corralation between Regional Bank and Blackrock Inflation
Assuming the 90 days horizon Regional Bank Fund is expected to under-perform the Blackrock Inflation. In addition to that, Regional Bank is 2.88 times more volatile than Blackrock Inflation Protected. It trades about -0.08 of its total potential returns per unit of risk. Blackrock Inflation Protected is currently generating about 0.09 per unit of volatility. If you would invest 974.00 in Blackrock Inflation Protected on September 12, 2024 and sell it today you would earn a total of 5.00 from holding Blackrock Inflation Protected or generate 0.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regional Bank Fund vs. Blackrock Inflation Protected
Performance |
| Timeline |
| Regional Bank |
| Blackrock Inflation |
Regional Bank and Blackrock Inflation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regional Bank and Blackrock Inflation
The main advantage of trading using opposite Regional Bank and Blackrock Inflation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regional Bank position performs unexpectedly, Blackrock Inflation 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 Inflation will offset losses from the drop in Blackrock Inflation's long position.| Regional Bank vs. Blackrock Inflation Protected | Regional Bank vs. Aqr Managed Futures | Regional Bank vs. Short Duration Inflation | Regional Bank vs. Ab Bond Inflation |
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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