Correlation Between Blackrock Muniyield and BBX Capital
Can any of the company-specific risk be diversified away by investing in both Blackrock Muniyield and BBX Capital 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 Muniyield and BBX Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Muniyield Mi and BBX Capital, you can compare the effects of market volatilities on Blackrock Muniyield and BBX Capital 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 Muniyield with a short position of BBX Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Muniyield and BBX Capital.
Diversification Opportunities for Blackrock Muniyield and BBX Capital
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BlackRock and BBX is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Muniyield Mi and BBX Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BBX Capital and Blackrock Muniyield 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 Muniyield Mi are associated (or correlated) with BBX Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BBX Capital has no effect on the direction of Blackrock Muniyield i.e., Blackrock Muniyield and BBX Capital go up and down completely randomly.
Pair Corralation between Blackrock Muniyield and BBX Capital
Considering the 90-day investment horizon Blackrock Muniyield Mi is expected to generate 1.47 times more return on investment than BBX Capital. However, Blackrock Muniyield is 1.47 times more volatile than BBX Capital. It trades about 0.27 of its potential returns per unit of risk. BBX Capital is currently generating about -0.06 per unit of risk. If you would invest 1,156 in Blackrock Muniyield Mi on September 5, 2024 and sell it today you would earn a total of 39.00 from holding Blackrock Muniyield Mi or generate 3.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Blackrock Muniyield Mi vs. BBX Capital
Performance |
| Timeline |
| Blackrock Muniyield |
| BBX Capital |
Blackrock Muniyield and BBX Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Muniyield and BBX Capital
The main advantage of trading using opposite Blackrock Muniyield and BBX Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Muniyield position performs unexpectedly, BBX Capital 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 BBX Capital will offset losses from the drop in BBX Capital's long position.| Blackrock Muniyield vs. John Hancock Income | Blackrock Muniyield vs. MFS High Income | Blackrock Muniyield vs. MFS Investment Grade | Blackrock Muniyield vs. Blackrock Muniholdings Closed |
| BBX Capital vs. Blackrock International Growth | BBX Capital vs. Blackrock Enhanced Equity | BBX Capital vs. Eaton Vance Tax | BBX Capital vs. Blackrock Resources Commodities |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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