Correlation Between Blackrock Muniholdings and Unico American
Can any of the company-specific risk be diversified away by investing in both Blackrock Muniholdings and Unico American 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 Muniholdings and Unico American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Muniholdings Ny and Unico American, you can compare the effects of market volatilities on Blackrock Muniholdings and Unico American 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 Muniholdings with a short position of Unico American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Muniholdings and Unico American.
Diversification Opportunities for Blackrock Muniholdings and Unico American
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Blackrock and Unico is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Muniholdings Ny and Unico American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unico American and Blackrock Muniholdings 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 Muniholdings Ny are associated (or correlated) with Unico American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unico American has no effect on the direction of Blackrock Muniholdings i.e., Blackrock Muniholdings and Unico American go up and down completely randomly.
Pair Corralation between Blackrock Muniholdings and Unico American
Considering the 90-day investment horizon Blackrock Muniholdings is expected to generate 5.56 times less return on investment than Unico American. But when comparing it to its historical volatility, Blackrock Muniholdings Ny is 3.26 times less risky than Unico American. It trades about 0.12 of its potential returns per unit of risk. Unico American is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 5.50 in Unico American on August 29, 2024 and sell it today you would earn a total of 0.50 from holding Unico American or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Muniholdings Ny vs. Unico American
Performance |
| Timeline |
| Blackrock Muniholdings |
| Unico American |
Blackrock Muniholdings and Unico American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Muniholdings and Unico American
The main advantage of trading using opposite Blackrock Muniholdings and Unico American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Muniholdings position performs unexpectedly, Unico American 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 Unico American will offset losses from the drop in Unico American's long position.| Blackrock Muniholdings vs. Eaton Vance National | Blackrock Muniholdings vs. Invesco High Income | Blackrock Muniholdings vs. Nuveen California Select | Blackrock Muniholdings vs. MFS Investment Grade |
| Unico American vs. Invesco High Income | Unico American vs. Blackrock Muniholdings Ny | Unico American vs. MFS Investment Grade | Unico American vs. Federated Premier Municipal |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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