Correlation Between Blackstar Enterprise and XTRA Bitcoin

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

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

Diversification Opportunities for Blackstar Enterprise and XTRA Bitcoin

0.68

Correlation Coefficient

Blackstar Enterprise  XTRA Bitcoin

Poor diversification

The 3 months correlation between Blackstar and XTRA is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Blackstar Enterprise Group and XTRA Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XTRA Bitcoin and Blackstar Enterprise 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 Blackstar Enterprise Group are associated (or correlated) with XTRA Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XTRA Bitcoin has no effect on the direction of Blackstar Enterprise i.e., Blackstar Enterprise and XTRA Bitcoin go up and down completely randomly.

Pair Corralation between Blackstar Enterprise and XTRA Bitcoin

Given the investment horizon of 90 days Blackstar Enterprise Group is expected to generate 1.12 times more return on investment than XTRA Bitcoin. However, Blackstar Enterprise is 1.12 times more volatile than XTRA Bitcoin. It trades about 0.06 of its potential returns per unit of risk. XTRA Bitcoin is currently generating about 0.03 per unit of risk. If you would invest  0.06  in Blackstar Enterprise Group on December 2, 2024 and sell it today you would earn a total of  0.00  from holding Blackstar Enterprise Group or generate 0.0% return on investment over 90 days.

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

Blackstar Enterprise Group  vs.  XTRA Bitcoin

Blackstar Enterprise

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blackstar Enterprise Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

XTRA Bitcoin

Risk-Adjusted Performance

Very Weak

Over the last 90 days XTRA Bitcoin has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Blackstar Enterprise and XTRA Bitcoin

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

The idea behind Blackstar Enterprise Group and XTRA Bitcoin 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.