Correlation Between Blackstone and Perella Weinberg

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

By analyzing existing cross correlation between Blackstone Group and Perella Weinberg Partners, you can compare the effects of market volatilities on Blackstone and Perella Weinberg 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 Perella Weinberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackstone and Perella Weinberg.

Diversification Opportunities for Blackstone and Perella Weinberg

0.73

Correlation Coefficient

Blackstone  Perella Weinberg

Poor diversification

The 3 months correlation between Blackstone and Perella is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Perella Weinberg Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perella Weinberg Partners 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 Perella Weinberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perella Weinberg Partners has no effect on the direction of Blackstone i.e., Blackstone and Perella Weinberg go up and down completely randomly.

Pair Corralation between Blackstone and Perella Weinberg

Allowing for the 90-day total investment horizon Blackstone Group is expected to under-perform the Perella Weinberg. But the stock apears to be less risky and, when comparing its historical volatility, Blackstone Group is 1.3 times less risky than Perella Weinberg. The stock trades about -0.14 of its potential returns per unit of risk. The Perella Weinberg Partners is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest  2,552  in Perella Weinberg Partners on November 28, 2024 and sell it today you would lose (253.50) from holding Perella Weinberg Partners or give up 9.93% of portfolio value over 90 days.

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

Blackstone Group  vs.  Perella Weinberg Partners

Blackstone Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blackstone Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Perella Weinberg Partners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Perella Weinberg Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Blackstone and Perella Weinberg

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

The idea behind Blackstone Group and Perella Weinberg Partners 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.

Check out your portfolio center.

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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.