Correlation Between Queens Road and Blackstone

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

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

Diversification Opportunities for Queens Road and Blackstone

Very good diversification

The 3 months correlation between Queens and Blackstone is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Queens Road Capital and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group and Queens Road 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 Queens Road Capital 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 Queens Road i.e., Queens Road and Blackstone go up and down completely randomly.

Pair Corralation between Queens Road and Blackstone

Assuming the 90 days horizon Queens Road Capital is expected to under-perform the Blackstone. In addition to that, Queens Road is 1.01 times more volatile than Blackstone Group. It trades about -0.15 of its total potential returns per unit of risk. Blackstone Group is currently generating about 0.39 per unit of volatility. If you would invest  9,916  in Blackstone Group on September 9, 2023 and sell it today you would earn a total of  1,470  from holding Blackstone Group or generate 14.82% return on investment over 90 days.

Queens Road Capital  vs.  Blackstone Group

Queens Road Capital

Queens Performance

2 of 100

Compared to the overall equity markets, risk-adjusted returns on investments in Queens Road Capital are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Queens Road may actually be approaching a critical reversion point that can send shares even higher in January 2024.

Blackstone Group

Blackstone Performance

1 of 100

Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Blackstone is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Queens Road and Blackstone

The main advantage of trading using opposite Queens Road and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Queens Road 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.

The idea behind Queens Road Capital and Blackstone Group 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.

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 Global Correlations module to find global opportunities by holding instruments from different markets.