Correlation Between Investcorp Credit and Blackrock Munivest

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

By analyzing existing cross correlation between Investcorp Credit Management and Blackrock Munivest, you can compare the effects of market volatilities on Investcorp Credit and Blackrock Munivest 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 Investcorp Credit with a short position of Blackrock Munivest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investcorp Credit and Blackrock Munivest.

Diversification Opportunities for Investcorp Credit and Blackrock Munivest

0.09

Correlation Coefficient

Investcorp Credit  Blackrock Munivest

Significant diversification

The 3 months correlation between Investcorp and Blackrock is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Investcorp Credit Management and Blackrock Munivest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Munivest and Investcorp Credit 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 Investcorp Credit Management are associated (or correlated) with Blackrock Munivest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Munivest has no effect on the direction of Investcorp Credit i.e., Investcorp Credit and Blackrock Munivest go up and down completely randomly.

Pair Corralation between Investcorp Credit and Blackrock Munivest

Given the investment horizon of 90 days Investcorp Credit Management is expected to generate 2.44 times more return on investment than Blackrock Munivest. However, Investcorp Credit is 2.44 times more volatile than Blackrock Munivest. It trades about 0.14 of its potential returns per unit of risk. Blackrock Munivest is currently generating about -0.05 per unit of risk. If you would invest  306.00  in Investcorp Credit Management on September 16, 2024 and sell it today you would earn a total of  14.00  from holding Investcorp Credit Management or generate 4.58% return on investment over 90 days.

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

Investcorp Credit Management  vs.  Blackrock Munivest

Investcorp Credit

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Investcorp Credit Management are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong primary indicators, Investcorp Credit is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Blackrock Munivest

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackrock Munivest has generated negative risk-adjusted returns adding no value to fund investors. In spite of comparatively stable basic indicators, Blackrock Munivest 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 Investcorp Credit and Blackrock Munivest

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

The idea behind Investcorp Credit Management and Blackrock Munivest 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.