Correlation Between Bridge Investment and Blue Owl

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

By analyzing existing cross correlation between Bridge Investment Group and Blue Owl Capital, you can compare the effects of market volatilities on Bridge Investment and Blue Owl 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 Bridge Investment with a short position of Blue Owl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bridge Investment and Blue Owl.

Diversification Opportunities for Bridge Investment and Blue Owl

-0.17

Correlation Coefficient

Bridge Investment  Blue Owl

Good diversification

The 3 months correlation between Bridge and Blue is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Bridge Investment Group and Blue Owl Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Owl Capital and Bridge Investment 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 Bridge Investment Group are associated (or correlated) with Blue Owl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Owl Capital has no effect on the direction of Bridge Investment i.e., Bridge Investment and Blue Owl go up and down completely randomly.

Pair Corralation between Bridge Investment and Blue Owl

Given the investment horizon of 90 days Bridge Investment Group is expected to generate 2.12 times more return on investment than Blue Owl. However, Bridge Investment is 2.12 times more volatile than Blue Owl Capital. It trades about 0.04 of its potential returns per unit of risk. Blue Owl Capital is currently generating about -0.06 per unit of risk. If you would invest  979.00  in Bridge Investment Group on November 28, 2024 and sell it today you would earn a total of  49.00  from holding Bridge Investment Group or generate 5.01% return on investment over 90 days.

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

Bridge Investment Group  vs.  Blue Owl Capital

Bridge Investment

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bridge Investment Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating fundamental indicators, Bridge Investment may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Blue Owl Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blue Owl Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Bridge Investment and Blue Owl

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

The idea behind Bridge Investment Group and Blue Owl Capital 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.