Correlation Between FS Energy and BlackRock
Can any of the company-specific risk be diversified away by investing in both FS Energy and BlackRock 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 FS Energy and BlackRock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FS Energy and and BlackRock, you can compare the effects of market volatilities on FS Energy and BlackRock 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 FS Energy with a short position of BlackRock. Check out your portfolio center. Please also check ongoing floating volatility patterns of FS Energy and BlackRock.
Diversification Opportunities for FS Energy and BlackRock
Very weak diversification
The 3 months correlation between FSEN and BlackRock is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding FS Energy and and BlackRock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlackRock and FS Energy 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 FS Energy and are associated (or correlated) with BlackRock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlackRock has no effect on the direction of FS Energy i.e., FS Energy and BlackRock go up and down completely randomly.
Pair Corralation between FS Energy and BlackRock
Given the investment horizon of 90 days FS Energy and is expected to generate 4.19 times more return on investment than BlackRock. However, FS Energy is 4.19 times more volatile than BlackRock. It trades about 0.03 of its potential returns per unit of risk. BlackRock is currently generating about 0.1 per unit of risk. If you would invest 216.00 in FS Energy and on August 31, 2024 and sell it today you would earn a total of 34.00 from holding FS Energy and or generate 15.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
FS Energy and vs. BlackRock
Performance |
| Timeline |
| FS Energy |
| BlackRock |
FS Energy and BlackRock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FS Energy and BlackRock
The main advantage of trading using opposite FS Energy and BlackRock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FS Energy position performs unexpectedly, BlackRock 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 will offset losses from the drop in BlackRock's long position.| FS Energy vs. Business Development Corp | FS Energy vs. Inpex Corp ADR | FS Energy vs. Daikin IndustriesLtd |
| BlackRock vs. KKR Co LP | BlackRock vs. Apollo Global Management | BlackRock vs. Brookfield Asset Management | BlackRock vs. Carlyle Group |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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