Correlation Between Blackstone and Bank of New York
Can any of the company-specific risk be diversified away by investing in both Blackstone and Bank of New York 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 Blackstone and Bank of New York into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackstone Group and Bank of New, you can compare the effects of market volatilities on Blackstone and Bank of New York 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 Blackstone with a short position of Bank of New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and Bank of New York.
Diversification Opportunities for Blackstone and Bank of New York
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Blackstone and Bank is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Bank of New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of New York and Blackstone 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 Blackstone Group are associated (or correlated) with Bank of New York. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of New York has no effect on the direction of Blackstone i.e., Blackstone and Bank of New York go up and down completely randomly.
Pair Corralation between Blackstone and Bank of New York
Allowing for the 90-day total investment horizon Blackstone Group is expected to under-perform the Bank of New York. In addition to that, Blackstone is 1.69 times more volatile than Bank of New. It trades about -0.07 of its total potential returns per unit of risk. Bank of New is currently generating about 0.1 per unit of volatility. If you would invest 5,661 in Bank of New on January 26, 2024 and sell it today you would earn a total of 134.00 from holding Bank of New or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackstone Group vs. Bank of New
Performance |
| Timeline |
| Blackstone Group |
| Bank of New York |
Blackstone and Bank of New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackstone and Bank of New York
The main advantage of trading using opposite Blackstone and Bank of New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone position performs unexpectedly, Bank of New York 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 Bank of New York will offset losses from the drop in Bank of New York's long position.| Blackstone vs. T Rowe Price | Blackstone vs. State Street Corp | Blackstone vs. KKR Co LP | Blackstone vs. Brookfield Asset Management |
| Bank of New York vs. Federated Premier Municipal | Bank of New York vs. Blackrock Muniyield | Bank of New York vs. Diamond Hill Investment | Bank of New York vs. NXG NextGen Infrastructure |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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