Correlation Between Hotchkis Wiley and Blackstone Secured

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

By analyzing existing cross correlation between Hotchkis Wiley Global and Blackstone Secured Lending, you can compare the effects of market volatilities on Hotchkis Wiley and Blackstone Secured 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 Hotchkis Wiley with a short position of Blackstone Secured. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotchkis Wiley and Blackstone Secured.

Diversification Opportunities for Hotchkis Wiley and Blackstone Secured

0.63

Correlation Coefficient

Hotchkis Wiley  Blackstone Secured

Poor diversification

The 3 months correlation between Hotchkis and Blackstone is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Hotchkis Wiley Global and Blackstone Secured Lending in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Secured and Hotchkis Wiley 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 Hotchkis Wiley Global are associated (or correlated) with Blackstone Secured. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Secured has no effect on the direction of Hotchkis Wiley i.e., Hotchkis Wiley and Blackstone Secured go up and down completely randomly.

Pair Corralation between Hotchkis Wiley and Blackstone Secured

Assuming the 90 days horizon Hotchkis Wiley Global is expected to generate 0.73 times more return on investment than Blackstone Secured. However, Hotchkis Wiley Global is 1.37 times less risky than Blackstone Secured. It trades about 0.14 of its potential returns per unit of risk. Blackstone Secured Lending is currently generating about 0.06 per unit of risk. If you would invest  1,392  in Hotchkis Wiley Global on December 23, 2024 and sell it today you would earn a total of  102.00  from holding Hotchkis Wiley Global or generate 7.33% return on investment over 90 days.

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

Hotchkis Wiley Global  vs.  Blackstone Secured Lending

Hotchkis Wiley Global

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hotchkis Wiley Global are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly abnormal forward indicators, Hotchkis Wiley may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Blackstone Secured

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Secured Lending are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Blackstone Secured is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Hotchkis Wiley and Blackstone Secured

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

The idea behind Hotchkis Wiley Global and Blackstone Secured Lending 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.