Correlation Between Blackrock Alternative and Fidelity Sai

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

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

Diversification Opportunities for Blackrock Alternative and Fidelity Sai

0.49

Correlation Coefficient

Blackrock Alternative  Fidelity Sai

Very weak diversification

The 3 months correlation between Blackrock and Fidelity is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Alternative Capital and Fidelity Sai Alternative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Sai Alternative and Blackrock Alternative 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 Blackrock Alternative Capital are associated (or correlated) with Fidelity Sai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Sai Alternative has no effect on the direction of Blackrock Alternative i.e., Blackrock Alternative and Fidelity Sai go up and down completely randomly.

Pair Corralation between Blackrock Alternative and Fidelity Sai

Assuming the 90 days horizon Blackrock Alternative Capital is expected to under-perform the Fidelity Sai. In addition to that, Blackrock Alternative is 1.57 times more volatile than Fidelity Sai Alternative. It trades about -0.17 of its total potential returns per unit of risk. Fidelity Sai Alternative is currently generating about -0.12 per unit of volatility. If you would invest  946.00  in Fidelity Sai Alternative on October 4, 2024 and sell it today you would lose (24.00) from holding Fidelity Sai Alternative or give up 2.54% of portfolio value over 90 days.

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

Blackrock Alternative Capital  vs.  Fidelity Sai Alternative

Blackrock Alternative

Risk-Adjusted Performance

0 of 100

Very Weak

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

Fidelity Sai Alternative

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Blackrock Alternative and Fidelity Sai

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

The idea behind Blackrock Alternative Capital and Fidelity Sai Alternative 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.