Correlation Between Stone Harbor and Blackrock
Can any of the company-specific risk be diversified away by investing in both Stone Harbor and Blackrock 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 Stone Harbor and Blackrock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stone Harbor Emerging and Blackrock Sm Cap, you can compare the effects of market volatilities on Stone Harbor and Blackrock 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 Stone Harbor with a short position of Blackrock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stone Harbor and Blackrock.
Diversification Opportunities for Stone Harbor and Blackrock
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Stone and Blackrock is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Stone Harbor Emerging and Blackrock Sm Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Sm Cap and Stone Harbor 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 Stone Harbor Emerging are associated (or correlated) with Blackrock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Sm Cap has no effect on the direction of Stone Harbor i.e., Stone Harbor and Blackrock go up and down completely randomly.
Pair Corralation between Stone Harbor and Blackrock
Assuming the 90 days horizon Stone Harbor Emerging is expected to generate 0.23 times more return on investment than Blackrock. However, Stone Harbor Emerging is 4.4 times less risky than Blackrock. It trades about 0.23 of its potential returns per unit of risk. Blackrock Sm Cap is currently generating about 0.02 per unit of risk. If you would invest 747.00 in Stone Harbor Emerging on September 13, 2024 and sell it today you would earn a total of 8.00 from holding Stone Harbor Emerging or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Stone Harbor Emerging vs. Blackrock Sm Cap
Performance |
| Timeline |
| Stone Harbor Emerging |
| Blackrock Sm Cap |
Stone Harbor and Blackrock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stone Harbor and Blackrock
The main advantage of trading using opposite Stone Harbor and Blackrock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stone Harbor position performs unexpectedly, Blackrock 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 will offset losses from the drop in Blackrock's long position.| Stone Harbor vs. Stone Harbor Local | Stone Harbor vs. Vanguard 500 Index | Stone Harbor vs. Nuveen Santa Barbara | Stone Harbor vs. Money Market Obligations |
| Blackrock vs. Blackrock Intern Index | Blackrock vs. Blackrock Sp 500 | Blackrock vs. Blackrock Bond Index | Blackrock vs. Blackrock Small Cap |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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