Correlation Between Astar and Blackrock Advantage

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

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

Diversification Opportunities for Astar and Blackrock Advantage

-0.15

Correlation Coefficient

Astar  Blackrock Advantage

Good diversification

The 3 months correlation between Astar and Blackrock is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Astar and Blackrock Advantage Esg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Advantage Esg and Astar 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 Astar are associated (or correlated) with Blackrock Advantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Advantage Esg has no effect on the direction of Astar i.e., Astar and Blackrock Advantage go up and down completely randomly.

Pair Corralation between Astar and Blackrock Advantage

Assuming the 90 days trading horizon Astar is expected to generate 5.59 times more return on investment than Blackrock Advantage. However, Astar is 5.59 times more volatile than Blackrock Advantage Esg. It trades about -0.01 of its potential returns per unit of risk. Blackrock Advantage Esg is currently generating about -0.35 per unit of risk. If you would invest  6.98  in Astar on October 9, 2024 and sell it today you would lose (0.25) from holding Astar or give up 3.58% of portfolio value over 90 days.

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

Astar  vs.  Blackrock Advantage Esg

Astar

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Astar are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Astar exhibited solid returns over the last few months and may actually be approaching a breakup point.

Blackrock Advantage Esg

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackrock Advantage Esg has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward-looking signals remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Astar and Blackrock Advantage

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

The idea behind Astar and Blackrock Advantage Esg 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.