Correlation Between BlackRock ESG and VanEck IBoxx
Can any of the company-specific risk be diversified away by investing in both BlackRock ESG and VanEck IBoxx 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 BlackRock ESG and VanEck IBoxx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock ESG Multi Asset and VanEck iBoxx EUR, you can compare the effects of market volatilities on BlackRock ESG and VanEck IBoxx 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 BlackRock ESG with a short position of VanEck IBoxx. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock ESG and VanEck IBoxx.
Diversification Opportunities for BlackRock ESG and VanEck IBoxx
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BlackRock and VanEck is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock ESG Multi Asset and VanEck iBoxx EUR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck iBoxx EUR and BlackRock ESG 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 BlackRock ESG Multi Asset are associated (or correlated) with VanEck IBoxx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck iBoxx EUR has no effect on the direction of BlackRock ESG i.e., BlackRock ESG and VanEck IBoxx go up and down completely randomly.
Pair Corralation between BlackRock ESG and VanEck IBoxx
Assuming the 90 days trading horizon BlackRock ESG Multi Asset is expected to generate 1.62 times more return on investment than VanEck IBoxx. However, BlackRock ESG is 1.62 times more volatile than VanEck iBoxx EUR. It trades about 0.19 of its potential returns per unit of risk. VanEck iBoxx EUR is currently generating about 0.04 per unit of risk. If you would invest 497.00 in BlackRock ESG Multi Asset on September 2, 2024 and sell it today you would earn a total of 117.00 from holding BlackRock ESG Multi Asset or generate 23.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock ESG Multi Asset vs. VanEck iBoxx EUR
Performance |
| Timeline |
| BlackRock ESG Multi |
| VanEck iBoxx EUR |
BlackRock ESG and VanEck IBoxx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock ESG and VanEck IBoxx
The main advantage of trading using opposite BlackRock ESG and VanEck IBoxx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock ESG position performs unexpectedly, VanEck IBoxx 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 VanEck IBoxx will offset losses from the drop in VanEck IBoxx's long position.| BlackRock ESG vs. Vanguard SP 500 | BlackRock ESG vs. SPDR Dow Jones | BlackRock ESG vs. iShares Core MSCI | BlackRock ESG vs. iShares SP 500 |
| VanEck IBoxx vs. iShares Core MSCI | VanEck IBoxx vs. BlackRock ESG Multi Asset | VanEck IBoxx vs. Pershing Square Holdings | VanEck IBoxx vs. ASML Holding NV |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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