Correlation Between Blackrock Systematic and Fidelity Sai

Can any of the company-specific risk be diversified away by investing in both Blackrock Systematic 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 Systematic 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 Systematic Multi Strategy and Fidelity Sai Alternative, you can compare the effects of market volatilities on Blackrock Systematic 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 Systematic with a short position of Fidelity Sai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Systematic and Fidelity Sai.

Diversification Opportunities for Blackrock Systematic and Fidelity Sai

0.47

Correlation Coefficient

Blackrock Systematic  Fidelity Sai

Very weak diversification

The 3 months correlation between Blackrock and Fidelity is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Systematic Multi Str 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 Systematic 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 Systematic Multi Strategy 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 Systematic i.e., Blackrock Systematic and Fidelity Sai go up and down completely randomly.

Pair Corralation between Blackrock Systematic and Fidelity Sai

Assuming the 90 days horizon Blackrock Systematic Multi Strategy is expected to under-perform the Fidelity Sai. In addition to that, Blackrock Systematic is 2.39 times more volatile than Fidelity Sai Alternative. It trades about -0.32 of its total potential returns per unit of risk. Fidelity Sai Alternative is currently generating about -0.31 per unit of volatility. If you would invest  944.00  in Fidelity Sai Alternative on October 4, 2024 and sell it today you would lose (22.00) from holding Fidelity Sai Alternative or give up 2.33% of portfolio value over 90 days.

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

Blackrock Systematic Multi Str  vs.  Fidelity Sai Alternative

Blackrock Systematic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackrock Systematic Multi Strategy has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, Blackrock Systematic 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 Systematic and Fidelity Sai

The main advantage of trading using opposite Blackrock Systematic and Fidelity Sai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Systematic 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 Systematic Multi Strategy 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.