Correlation Between Blackrock Muniholdings and Eaton Vance

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

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

Diversification Opportunities for Blackrock Muniholdings and Eaton Vance

0.71

Correlation Coefficient

Blackrock Muniholdings  Eaton Vance

Poor diversification

The 3 months correlation between Blackrock and Eaton is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Muniholdings Ny and Eaton Vance National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance National and Blackrock Muniholdings 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 Blackrock Muniholdings Ny are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance National has no effect on the direction of Blackrock Muniholdings i.e., Blackrock Muniholdings and Eaton Vance go up and down completely randomly.

Pair Corralation between Blackrock Muniholdings and Eaton Vance

Considering the 90-day investment horizon Blackrock Muniholdings Ny is expected to under-perform the Eaton Vance. In addition to that, Blackrock Muniholdings is 1.03 times more volatile than Eaton Vance National. It trades about -0.02 of its total potential returns per unit of risk. Eaton Vance National is currently generating about 0.06 per unit of volatility. If you would invest  1,633  in Eaton Vance National on December 29, 2024 and sell it today you would earn a total of  34.00  from holding Eaton Vance National or generate 2.08% return on investment over 90 days.

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

Blackrock Muniholdings Ny  vs.  Eaton Vance National

Blackrock Muniholdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blackrock Muniholdings Ny has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy technical indicators, Blackrock Muniholdings is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Eaton Vance National

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance National are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Eaton Vance is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Blackrock Muniholdings and Eaton Vance

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

The idea behind Blackrock Muniholdings Ny and Eaton Vance National 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.