Correlation Between Blackstone and Guggenheim Strategic

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Can any of the company-specific risk be diversified away by investing in both Blackstone and Guggenheim Strategic 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 and Guggenheim Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackstone Group and Guggenheim Strategic Opportunities, you can compare the effects of market volatilities on Blackstone and Guggenheim Strategic 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 with a short position of Guggenheim Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and Guggenheim Strategic.

Diversification Opportunities for Blackstone and Guggenheim Strategic

0.83
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Blackstone and Guggenheim is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Guggenheim Strategic Opportuni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Strategic and Blackstone 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 Group are associated (or correlated) with Guggenheim Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Strategic has no effect on the direction of Blackstone i.e., Blackstone and Guggenheim Strategic go up and down completely randomly.

Pair Corralation between Blackstone and Guggenheim Strategic

Allowing for the 90-day total investment horizon Blackstone Group is expected to generate 4.07 times more return on investment than Guggenheim Strategic. However, Blackstone is 4.07 times more volatile than Guggenheim Strategic Opportunities. It trades about 0.28 of its potential returns per unit of risk. Guggenheim Strategic Opportunities is currently generating about 0.26 per unit of risk. If you would invest  13,642  in Blackstone Group on September 6, 2024 and sell it today you would earn a total of  4,908  from holding Blackstone Group or generate 35.98% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Blackstone Group  vs.  Guggenheim Strategic Opportuni

 Performance 
       Timeline  
Blackstone Group 

Risk-Adjusted Performance

22 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Group are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Blackstone showed solid returns over the last few months and may actually be approaching a breakup point.
Guggenheim Strategic 

Risk-Adjusted Performance

20 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim Strategic Opportunities are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent basic indicators, Guggenheim Strategic may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Blackstone and Guggenheim Strategic Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Blackstone and Guggenheim Strategic

The main advantage of trading using opposite Blackstone and Guggenheim Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone position performs unexpectedly, Guggenheim Strategic 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 Guggenheim Strategic will offset losses from the drop in Guggenheim Strategic's long position.
The idea behind Blackstone Group and Guggenheim Strategic Opportunities 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

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