Correlation Between Blackrock Large and Nasdaq-100(r)
Can any of the company-specific risk be diversified away by investing in both Blackrock Large and Nasdaq-100(r) 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 Large and Nasdaq-100(r) into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Large Cap and Nasdaq 100 2x Strategy, you can compare the effects of market volatilities on Blackrock Large and Nasdaq-100(r) 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 Large with a short position of Nasdaq-100(r). Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Large and Nasdaq-100(r).
Diversification Opportunities for Blackrock Large and Nasdaq-100(r)
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Blackrock and Nasdaq-100(r) is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Large Cap and Nasdaq 100 2x Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 2x and Blackrock Large 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 Large Cap are associated (or correlated) with Nasdaq-100(r). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 2x has no effect on the direction of Blackrock Large i.e., Blackrock Large and Nasdaq-100(r) go up and down completely randomly.
Pair Corralation between Blackrock Large and Nasdaq-100(r)
Assuming the 90 days horizon Blackrock Large is expected to generate 1.68 times less return on investment than Nasdaq-100(r). But when comparing it to its historical volatility, Blackrock Large Cap is 1.91 times less risky than Nasdaq-100(r). It trades about 0.1 of its potential returns per unit of risk. Nasdaq 100 2x Strategy is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 19,083 in Nasdaq 100 2x Strategy on October 29, 2024 and sell it today you would earn a total of 22,212 from holding Nasdaq 100 2x Strategy or generate 116.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Large Cap vs. Nasdaq 100 2x Strategy
Performance |
| Timeline |
| Blackrock Large Cap |
| Nasdaq 100 2x |
Blackrock Large and Nasdaq-100(r) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Large and Nasdaq-100(r)
The main advantage of trading using opposite Blackrock Large and Nasdaq-100(r) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Large position performs unexpectedly, Nasdaq-100(r) 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 Nasdaq-100(r) will offset losses from the drop in Nasdaq-100(r)'s long position.| Blackrock Large vs. Environment And Alternative | Blackrock Large vs. Cohen Steers Mlp | Blackrock Large vs. Virtus Select Mlp | Blackrock Large vs. Fidelity Advisor Energy |
| Nasdaq-100(r) vs. Environment And Alternative | Nasdaq-100(r) vs. Alpsalerian Energy Infrastructure | Nasdaq-100(r) vs. Salient Mlp Energy | Nasdaq-100(r) vs. World Energy Fund |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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