Correlation Between Blackrock and Managed Account
Can any of the company-specific risk be diversified away by investing in both Blackrock and Managed Account 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 and Managed Account into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Sp 500 and Managed Account Series, you can compare the effects of market volatilities on Blackrock and Managed Account 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 with a short position of Managed Account. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock and Managed Account.
Diversification Opportunities for Blackrock and Managed Account
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Blackrock and Managed is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Sp 500 and Managed Account Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Managed Account Series and Blackrock 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 Sp 500 are associated (or correlated) with Managed Account. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Managed Account Series has no effect on the direction of Blackrock i.e., Blackrock and Managed Account go up and down completely randomly.
Pair Corralation between Blackrock and Managed Account
Assuming the 90 days horizon Blackrock Sp 500 is expected to generate 2.34 times more return on investment than Managed Account. However, Blackrock is 2.34 times more volatile than Managed Account Series. It trades about 0.11 of its potential returns per unit of risk. Managed Account Series is currently generating about 0.06 per unit of risk. If you would invest 47,154 in Blackrock Sp 500 on October 25, 2024 and sell it today you would earn a total of 24,472 from holding Blackrock Sp 500 or generate 51.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Blackrock Sp 500 vs. Managed Account Series
Performance |
| Timeline |
| Blackrock Sp 500 |
| Managed Account Series |
Blackrock and Managed Account Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock and Managed Account
The main advantage of trading using opposite Blackrock and Managed Account positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock position performs unexpectedly, Managed Account 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 Managed Account will offset losses from the drop in Managed Account's long position.| Blackrock vs. Gmo Global Equity | Blackrock vs. Aqr Long Short Equity | Blackrock vs. Small Cap Equity | Blackrock vs. Gmo Global Equity |
| Managed Account vs. Bbh Intermediate Municipal | Managed Account vs. Morningstar Municipal Bond | Managed Account vs. T Rowe Price | Managed Account vs. Franklin Adjustable Government |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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