Correlation Between Valic Company and Blackrock
Can any of the company-specific risk be diversified away by investing in both Valic Company 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 Valic Company and Blackrock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valic Company I and Blackrock Hi Yld, you can compare the effects of market volatilities on Valic Company 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 Valic Company with a short position of Blackrock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valic Company and Blackrock.
Diversification Opportunities for Valic Company and Blackrock
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Valic and Blackrock is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Valic Company I and Blackrock Hi Yld in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Hi Yld and Valic Company 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 Valic Company I 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 Hi Yld has no effect on the direction of Valic Company i.e., Valic Company and Blackrock go up and down completely randomly.
Pair Corralation between Valic Company and Blackrock
Assuming the 90 days horizon Valic Company is expected to generate 1.01 times less return on investment than Blackrock. In addition to that, Valic Company is 1.8 times more volatile than Blackrock Hi Yld. It trades about 0.09 of its total potential returns per unit of risk. Blackrock Hi Yld is currently generating about 0.16 per unit of volatility. If you would invest 654.00 in Blackrock Hi Yld on November 8, 2024 and sell it today you would earn a total of 63.00 from holding Blackrock Hi Yld or generate 9.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valic Company I vs. Blackrock Hi Yld
Performance |
| Timeline |
| Valic Company I |
| Blackrock Hi Yld |
Valic Company and Blackrock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valic Company and Blackrock
The main advantage of trading using opposite Valic Company and Blackrock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valic Company 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.| Valic Company vs. Calvert Developed Market | Valic Company vs. Aqr Equity Market | Valic Company vs. Kinetics Market Opportunities | Valic Company vs. Aqr Sustainable Long Short |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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