Correlation Between Barclays PLC and Blackstone
Can any of the company-specific risk be diversified away by investing in both Barclays PLC and Blackstone 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 Barclays PLC and Blackstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barclays PLC ADR and Blackstone Group, you can compare the effects of market volatilities on Barclays PLC and Blackstone 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 Barclays PLC with a short position of Blackstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barclays PLC and Blackstone.
Diversification Opportunities for Barclays PLC and Blackstone
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Barclays and Blackstone is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Barclays PLC ADR and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group and Barclays PLC 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 Barclays PLC ADR are associated (or correlated) with Blackstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Group has no effect on the direction of Barclays PLC i.e., Barclays PLC and Blackstone go up and down completely randomly.
Pair Corralation between Barclays PLC and Blackstone
Considering the 90-day investment horizon Barclays PLC ADR is expected to generate 0.75 times more return on investment than Blackstone. However, Barclays PLC ADR is 1.33 times less risky than Blackstone. It trades about 0.12 of its potential returns per unit of risk. Blackstone Group is currently generating about -0.07 per unit of risk. If you would invest 925.00 in Barclays PLC ADR on January 26, 2024 and sell it today you would earn a total of 35.00 from holding Barclays PLC ADR or generate 3.78% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Barclays PLC ADR vs. Blackstone Group
Performance |
Timeline |
Barclays PLC ADR |
Blackstone Group |
Barclays PLC and Blackstone Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Barclays PLC and Blackstone
The main advantage of trading using opposite Barclays PLC and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barclays PLC position performs unexpectedly, Blackstone 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 Blackstone will offset losses from the drop in Blackstone's long position.Barclays PLC vs. Banco Bilbao Viscaya | Barclays PLC vs. Banco Santander SA | Barclays PLC vs. UBS Group AG | Barclays PLC vs. HSBC Holdings PLC |
Blackstone vs. T Rowe Price | Blackstone vs. State Street Corp | Blackstone vs. KKR Co LP | Blackstone vs. Brookfield Asset Management |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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