Correlation Between Blackstone Loan and Kinnevik Investment

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

By analyzing existing cross correlation between Blackstone Loan Financing and Kinnevik Investment AB, you can compare the effects of market volatilities on Blackstone Loan and Kinnevik Investment 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 Loan with a short position of Kinnevik Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone Loan and Kinnevik Investment.

Diversification Opportunities for Blackstone Loan and Kinnevik Investment

-0.19

Correlation Coefficient

Blackstone Loan  Kinnevik Investment

Good diversification

The 3 months correlation between Blackstone and Kinnevik is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Loan Financing and Kinnevik Investment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinnevik Investment and Blackstone Loan 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 Loan Financing are associated (or correlated) with Kinnevik Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinnevik Investment has no effect on the direction of Blackstone Loan i.e., Blackstone Loan and Kinnevik Investment go up and down completely randomly.

Pair Corralation between Blackstone Loan and Kinnevik Investment

Assuming the 90 days trading horizon Blackstone Loan Financing is expected to generate 0.45 times more return on investment than Kinnevik Investment. However, Blackstone Loan Financing is 2.23 times less risky than Kinnevik Investment. It trades about 0.1 of its potential returns per unit of risk. Kinnevik Investment AB is currently generating about -0.08 per unit of risk. If you would invest  5,796  in Blackstone Loan Financing on September 21, 2024 and sell it today you would earn a total of  604.00  from holding Blackstone Loan Financing or generate 10.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.07%
Values	Daily Returns

Blackstone Loan Financing  vs.  Kinnevik Investment AB

Blackstone Loan Financing

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Loan Financing are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Blackstone Loan may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Kinnevik Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kinnevik Investment AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Kinnevik Investment is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Blackstone Loan and Kinnevik Investment

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

The idea behind Blackstone Loan Financing and Kinnevik Investment AB 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.