Correlation Between Blackline and CCC Intelligent

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

By analyzing existing cross correlation between Blackline and CCC Intelligent Solutions, you can compare the effects of market volatilities on Blackline and CCC Intelligent 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 Blackline with a short position of CCC Intelligent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackline and CCC Intelligent.

Diversification Opportunities for Blackline and CCC Intelligent

0.81

Correlation Coefficient

Blackline  CCC Intelligent

Very poor diversification

The 3 months correlation between Blackline and CCC is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Blackline and CCC Intelligent Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCC Intelligent Solutions and Blackline 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 Blackline are associated (or correlated) with CCC Intelligent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCC Intelligent Solutions has no effect on the direction of Blackline i.e., Blackline and CCC Intelligent go up and down completely randomly.

Pair Corralation between Blackline and CCC Intelligent

Allowing for the 90-day total investment horizon Blackline is expected to generate 2.13 times more return on investment than CCC Intelligent. However, Blackline is 2.13 times more volatile than CCC Intelligent Solutions. It trades about -0.09 of its potential returns per unit of risk. CCC Intelligent Solutions is currently generating about -0.32 per unit of risk. If you would invest  6,120  in Blackline on December 27, 2024 and sell it today you would lose (1,068) from holding Blackline or give up 17.45% of portfolio value over 90 days.

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

Blackline  vs.  CCC Intelligent Solutions

Blackline

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blackline has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

CCC Intelligent Solutions

Risk-Adjusted Performance

Very Weak

Over the last 90 days CCC Intelligent Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Blackline and CCC Intelligent

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

The idea behind Blackline and CCC Intelligent Solutions 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.