Correlation Between Blackline and Intuit

Can any of the company-specific risk be diversified away by investing in both Blackline and Intuit 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 Blackline and Intuit into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Blackline and Intuit Inc, you can compare the effects of market volatilities on Blackline and Intuit 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 Blackline with a short position of Intuit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackline and Intuit.

Diversification Opportunities for Blackline and Intuit

0.06

Correlation Coefficient

Blackline  Intuit

Significant diversification

The 3 months correlation between Blackline and Intuit is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Blackline and Intuit Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuit Inc and Blackline 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 Blackline are associated (or correlated) with Intuit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuit Inc has no effect on the direction of Blackline i.e., Blackline and Intuit go up and down completely randomly.

Pair Corralation between Blackline and Intuit

Allowing for the 90-day total investment horizon Blackline is expected to under-perform the Intuit. In addition to that, Blackline is 2.17 times more volatile than Intuit Inc. It trades about -0.14 of its total potential returns per unit of risk. Intuit Inc is currently generating about -0.18 per unit of volatility. If you would invest  63,876  in Intuit Inc on January 20, 2024 and sell it today you would lose (3,038) from holding Intuit Inc or give up 4.76% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Blackline  vs.  Intuit Inc

Blackline

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackline has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, Blackline is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Intuit Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intuit Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Intuit is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Blackline and Intuit

The main advantage of trading using opposite Blackline and Intuit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackline position performs unexpectedly, Intuit 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 Intuit will offset losses from the drop in Intuit's long position.

The idea behind Blackline and Intuit Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.