Correlation Between Western Asset and Blackrock Strategic

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

By analyzing existing cross correlation between Western Asset Macro and Blackrock Strategic Opps, you can compare the effects of market volatilities on Western Asset and Blackrock Strategic 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 Western Asset with a short position of Blackrock Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Blackrock Strategic.

Diversification Opportunities for Western Asset and Blackrock Strategic

0.0

Correlation Coefficient

Western Asset  Blackrock Strategic

Pay attention - limited upside

The 3 months correlation between Western and Blackrock is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Macro and Blackrock Strategic Opps in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Strategic Opps and Western Asset 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 Western Asset Macro are associated (or correlated) with Blackrock Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Strategic Opps has no effect on the direction of Western Asset i.e., Western Asset and Blackrock Strategic go up and down completely randomly.

Pair Corralation between Western Asset and Blackrock Strategic

If you would invest  899.00  in Blackrock Strategic Opps on January 24, 2024 and sell it today you would earn a total of  26.00  from holding Blackrock Strategic Opps or generate 2.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Western Asset Macro  vs.  Blackrock Strategic Opps

Western Asset Macro

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Western Asset Macro has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Western Asset is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Blackrock Strategic Opps

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackrock Strategic Opps has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Blackrock Strategic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Western Asset and Blackrock Strategic

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

The idea behind Western Asset Macro and Blackrock Strategic Opps 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.