Correlation Between Blackrock Muniholdings and Phenixfin

Can any of the company-specific risk be diversified away by investing in both Blackrock Muniholdings and Phenixfin 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 Phenixfin 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 Phenixfin, you can compare the effects of market volatilities on Blackrock Muniholdings and Phenixfin 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 Phenixfin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Muniholdings and Phenixfin.

Diversification Opportunities for Blackrock Muniholdings and Phenixfin

-0.63

Correlation Coefficient

Blackrock Muniholdings  Phenixfin

Excellent diversification

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

Pair Corralation between Blackrock Muniholdings and Phenixfin

Considering the 90-day investment horizon Blackrock Muniholdings Ny is expected to under-perform the Phenixfin. But the fund apears to be less risky and, when comparing its historical volatility, Blackrock Muniholdings Ny is 2.42 times less risky than Phenixfin. The fund trades about -0.03 of its potential returns per unit of risk. The Phenixfin is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  4,917  in Phenixfin on October 23, 2024 and sell it today you would earn a total of  70.00  from holding Phenixfin or generate 1.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.33%
Values	Daily Returns

Blackrock Muniholdings Ny  vs.  Phenixfin

Blackrock Muniholdings

Risk-Adjusted Performance

0 of 100

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.

Phenixfin

Risk-Adjusted Performance

1 of 100

Weak

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

Pair Trading with Blackrock Muniholdings and Phenixfin

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

The idea behind Blackrock Muniholdings Ny and Phenixfin 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.