Correlation Between Blackstone and Cartesian Growth

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

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

Diversification Opportunities for Blackstone and Cartesian Growth

-0.25

Correlation Coefficient

Blackstone  Cartesian Growth

Very good diversification

The 3 months correlation between Blackstone and Cartesian is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group and Cartesian Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cartesian Growth 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 Cartesian Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cartesian Growth has no effect on the direction of Blackstone i.e., Blackstone and Cartesian Growth go up and down completely randomly.

Pair Corralation between Blackstone and Cartesian Growth

Allowing for the 90-day total investment horizon Blackstone Group is expected to under-perform the Cartesian Growth. In addition to that, Blackstone is 20.2 times more volatile than Cartesian Growth. It trades about -0.1 of its total potential returns per unit of risk. Cartesian Growth is currently generating about 0.08 per unit of volatility. If you would invest  1,163  in Cartesian Growth on December 21, 2024 and sell it today you would earn a total of  6.00  from holding Cartesian Growth or generate 0.52% return on investment over 90 days.

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

Blackstone Group  vs.  Cartesian Growth

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 April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Cartesian Growth

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cartesian Growth are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Cartesian Growth is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Blackstone and Cartesian Growth

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

The idea behind Blackstone Group and Cartesian Growth 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.