Correlation Between Blackrock Muniyield and Horizon Technology
Can any of the company-specific risk be diversified away by investing in both Blackrock Muniyield and Horizon Technology 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 Horizon Technology 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 Horizon Technology Finance, you can compare the effects of market volatilities on Blackrock Muniyield and Horizon Technology 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 Horizon Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Muniyield and Horizon Technology.
Diversification Opportunities for Blackrock Muniyield and Horizon Technology
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Blackrock and Horizon is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Muniyield Mi and Horizon Technology Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Technology 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 Horizon Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Technology has no effect on the direction of Blackrock Muniyield i.e., Blackrock Muniyield and Horizon Technology go up and down completely randomly.
Pair Corralation between Blackrock Muniyield and Horizon Technology
Considering the 90-day investment horizon Blackrock Muniyield Mi is expected to generate 0.32 times more return on investment than Horizon Technology. However, Blackrock Muniyield Mi is 3.08 times less risky than Horizon Technology. It trades about 0.2 of its potential returns per unit of risk. Horizon Technology Finance is currently generating about -0.27 per unit of risk. If you would invest 1,153 in Blackrock Muniyield Mi on August 28, 2024 and sell it today you would earn a total of 21.00 from holding Blackrock Muniyield Mi or generate 1.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Muniyield Mi vs. Horizon Technology Finance
Performance |
| Timeline |
| Blackrock Muniyield |
| Horizon Technology |
Blackrock Muniyield and Horizon Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Muniyield and Horizon Technology
The main advantage of trading using opposite Blackrock Muniyield and Horizon Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Muniyield position performs unexpectedly, Horizon Technology 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 Horizon Technology will offset losses from the drop in Horizon Technology'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 |
| Horizon Technology vs. Gladstone Capital | Horizon Technology vs. Gladstone Investment | Horizon Technology vs. Prospect Capital | Horizon Technology vs. Stellus Capital Investment |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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