Correlation Between Blackstone and Japan Asia
Can any of the company-specific risk be diversified away by investing in both Blackstone and Japan Asia 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 Blackstone and Japan Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackstone Group and Japan Asia Investment, you can compare the effects of market volatilities on Blackstone and Japan Asia 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 Blackstone with a short position of Japan Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and Japan Asia.
Diversification Opportunities for Blackstone and Japan Asia
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Blackstone and Japan is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Japan Asia Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japan Asia Investment and Blackstone 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 Blackstone Group are associated (or correlated) with Japan Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japan Asia Investment has no effect on the direction of Blackstone i.e., Blackstone and Japan Asia go up and down completely randomly.
Pair Corralation between Blackstone and Japan Asia
Assuming the 90 days trading horizon Blackstone Group is expected to under-perform the Japan Asia. But the stock apears to be less risky and, when comparing its historical volatility, Blackstone Group is 1.13 times less risky than Japan Asia. The stock trades about -0.16 of its potential returns per unit of risk. The Japan Asia Investment is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 128.00 in Japan Asia Investment on December 30, 2024 and sell it today you would earn a total of 45.00 from holding Japan Asia Investment or generate 35.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Blackstone Group vs. Japan Asia Investment
Performance |
Timeline |
Blackstone Group |
Japan Asia Investment |
Blackstone and Japan Asia Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Blackstone and Japan Asia
The main advantage of trading using opposite Blackstone and Japan Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone position performs unexpectedly, Japan Asia 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 Japan Asia will offset losses from the drop in Japan Asia's long position.Blackstone vs. Hellenic Telecommunications Organization | Blackstone vs. Collins Foods Limited | Blackstone vs. Charter Communications | Blackstone vs. Entravision Communications |
Japan Asia vs. GOME Retail Holdings | Japan Asia vs. FLOW TRADERS LTD | Japan Asia vs. Adtalem Global Education | Japan Asia vs. Indutrade AB |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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