Correlation Between Blue Owl and State Street
Can any of the company-specific risk be diversified away by investing in both Blue Owl and State Street 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 Blue Owl and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Owl Capital and State Street Corp, you can compare the effects of market volatilities on Blue Owl and State Street 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 Blue Owl with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Owl and State Street.
Diversification Opportunities for Blue Owl and State Street
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Blue and State is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Blue Owl Capital and State Street Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Corp and Blue Owl 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 Blue Owl Capital are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Corp has no effect on the direction of Blue Owl i.e., Blue Owl and State Street go up and down completely randomly.
Pair Corralation between Blue Owl and State Street
Considering the 90-day investment horizon Blue Owl is expected to generate 1.1 times less return on investment than State Street. In addition to that, Blue Owl is 1.94 times more volatile than State Street Corp. It trades about 0.1 of its total potential returns per unit of risk. State Street Corp is currently generating about 0.22 per unit of volatility. If you would invest 8,986 in State Street Corp on August 23, 2024 and sell it today you would earn a total of 648.00 from holding State Street Corp or generate 7.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Owl Capital vs. State Street Corp
Performance |
| Timeline |
| Blue Owl Capital |
| State Street Corp |
Blue Owl and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Owl and State Street
The main advantage of trading using opposite Blue Owl and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Owl position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.| Blue Owl vs. Apollo Global Management | Blue Owl vs. KKR Co LP | Blue Owl vs. Affiliated Managers Group | Blue Owl vs. Ares Capital |
| State Street vs. Northern Trust | State Street vs. Franklin Resources | State Street vs. Invesco Plc | State Street vs. T Rowe Price |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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