Correlation Between Merck and Blackrock Debt
Can any of the company-specific risk be diversified away by investing in both Merck and Blackrock Debt 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 Merck and Blackrock Debt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merck Company and Blackrock Debt Strategies, you can compare the effects of market volatilities on Merck and Blackrock Debt 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 Merck with a short position of Blackrock Debt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and Blackrock Debt.
Diversification Opportunities for Merck and Blackrock Debt
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Merck and Blackrock is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and Blackrock Debt Strategies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Debt Strategies and Merck 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 Merck Company are associated (or correlated) with Blackrock Debt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Debt Strategies has no effect on the direction of Merck i.e., Merck and Blackrock Debt go up and down completely randomly.
Pair Corralation between Merck and Blackrock Debt
Considering the 90-day investment horizon Merck is expected to generate 46.6 times less return on investment than Blackrock Debt. In addition to that, Merck is 1.94 times more volatile than Blackrock Debt Strategies. It trades about 0.0 of its total potential returns per unit of risk. Blackrock Debt Strategies is currently generating about 0.11 per unit of volatility. If you would invest 777.00 in Blackrock Debt Strategies on August 28, 2024 and sell it today you would earn a total of 310.00 from holding Blackrock Debt Strategies or generate 39.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Merck Company vs. Blackrock Debt Strategies
Performance |
| Timeline |
| Merck Company |
| Blackrock Debt Strategies |
Merck and Blackrock Debt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and Blackrock Debt
The main advantage of trading using opposite Merck and Blackrock Debt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, Blackrock Debt 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 Blackrock Debt will offset losses from the drop in Blackrock Debt's long position.| Merck vs. Capricor Therapeutics | Merck vs. Soleno Therapeutics | Merck vs. Bio Path Holdings | Merck vs. Moleculin Biotech |
| Blackrock Debt vs. Blackrock Floating Rate | Blackrock Debt vs. Pioneer Floating Rate | Blackrock Debt vs. Eaton Vance Senior | Blackrock Debt vs. Eaton Vance Senior |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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