Correlation Between Stellus Capital and Blackstone

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

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

Diversification Opportunities for Stellus Capital and Blackstone

-0.46

Correlation Coefficient

Stellus Capital  Blackstone

Very good diversification

The 3 months correlation between Stellus and Blackstone is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Stellus Capital Investment and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group and Stellus Capital 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 Stellus Capital Investment 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 Stellus Capital i.e., Stellus Capital and Blackstone go up and down completely randomly.

Pair Corralation between Stellus Capital and Blackstone

Considering the 90-day investment horizon Stellus Capital Investment is expected to generate 0.48 times more return on investment than Blackstone. However, Stellus Capital Investment is 2.08 times less risky than Blackstone. It trades about 0.21 of its potential returns per unit of risk. Blackstone Group is currently generating about 0.01 per unit of risk. If you would invest  1,263  in Stellus Capital Investment on February 20, 2024 and sell it today you would earn a total of  152.00  from holding Stellus Capital Investment or generate 12.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Stellus Capital Investment  vs.  Blackstone Group

Stellus Capital Inve

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Stellus Capital Investment are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Stellus Capital may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Blackstone Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackstone Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Blackstone is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Stellus Capital and Blackstone

The main advantage of trading using opposite Stellus Capital and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stellus Capital 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 Stellus Capital Investment 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.