Correlation Between Americafirst Monthly and Blackrock Retirement

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

By analyzing existing cross correlation between Americafirst Monthly Risk On and Blackrock Retirement Income, you can compare the effects of market volatilities on Americafirst Monthly and Blackrock Retirement 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 Americafirst Monthly with a short position of Blackrock Retirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Americafirst Monthly and Blackrock Retirement.

Diversification Opportunities for Americafirst Monthly and Blackrock Retirement

-0.12

Correlation Coefficient

Americafirst Monthly  Blackrock Retirement

Good diversification

The 3 months correlation between Americafirst and Blackrock is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Americafirst Monthly Risk On and Blackrock Retirement Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Retirement and Americafirst Monthly 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 Americafirst Monthly Risk On are associated (or correlated) with Blackrock Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Retirement has no effect on the direction of Americafirst Monthly i.e., Americafirst Monthly and Blackrock Retirement go up and down completely randomly.

Pair Corralation between Americafirst Monthly and Blackrock Retirement

Assuming the 90 days horizon Americafirst Monthly Risk On is expected to generate 6.0 times more return on investment than Blackrock Retirement. However, Americafirst Monthly is 6.0 times more volatile than Blackrock Retirement Income. It trades about 0.08 of its potential returns per unit of risk. Blackrock Retirement Income is currently generating about -0.36 per unit of risk. If you would invest  1,503  in Americafirst Monthly Risk On on October 9, 2024 and sell it today you would earn a total of  46.00  from holding Americafirst Monthly Risk On or generate 3.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Americafirst Monthly Risk On  vs.  Blackrock Retirement Income

Americafirst Monthly

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Americafirst Monthly Risk On are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Americafirst Monthly showed solid returns over the last few months and may actually be approaching a breakup point.

Blackrock Retirement

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Americafirst Monthly and Blackrock Retirement

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

The idea behind Americafirst Monthly Risk On and Blackrock Retirement Income 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.