Correlation Between Eaton Vance and Blackrock Enhanced

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

By analyzing existing cross correlation between Eaton Vance New and Blackrock Enhanced Capital, you can compare the effects of market volatilities on Eaton Vance and Blackrock Enhanced 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 Eaton Vance with a short position of Blackrock Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Blackrock Enhanced.

Diversification Opportunities for Eaton Vance and Blackrock Enhanced

0.33

Correlation Coefficient

Eaton Vance  Blackrock Enhanced

Weak diversification

The 3 months correlation between Eaton and Blackrock is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance New and Blackrock Enhanced Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Enhanced and Eaton Vance 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 Eaton Vance New are associated (or correlated) with Blackrock Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Enhanced has no effect on the direction of Eaton Vance i.e., Eaton Vance and Blackrock Enhanced go up and down completely randomly.

Pair Corralation between Eaton Vance and Blackrock Enhanced

Considering the 90-day investment horizon Eaton Vance is expected to generate 2.1 times less return on investment than Blackrock Enhanced. In addition to that, Eaton Vance is 1.09 times more volatile than Blackrock Enhanced Capital. It trades about 0.03 of its total potential returns per unit of risk. Blackrock Enhanced Capital is currently generating about 0.06 per unit of volatility. If you would invest  1,584  in Blackrock Enhanced Capital on October 7, 2024 and sell it today you would earn a total of  446.00  from holding Blackrock Enhanced Capital or generate 28.16% return on investment over 90 days.

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

Eaton Vance New  vs.  Blackrock Enhanced Capital

Eaton Vance New

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance New are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Eaton Vance is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Blackrock Enhanced

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Enhanced Capital are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. Despite fairly strong forward indicators, Blackrock Enhanced is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Eaton Vance and Blackrock Enhanced

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

The idea behind Eaton Vance New and Blackrock Enhanced 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.