Correlation Between GraniteShares and BlackRock Latin

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

By analyzing existing cross correlation between GraniteShares 3x Short and BlackRock Latin American, you can compare the effects of market volatilities on GraniteShares and BlackRock Latin 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 GraniteShares with a short position of BlackRock Latin. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares and BlackRock Latin.

Diversification Opportunities for GraniteShares and BlackRock Latin

0.63

Correlation Coefficient

GraniteShares  BlackRock Latin

Poor diversification

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

Pair Corralation between GraniteShares and BlackRock Latin

Assuming the 90 days trading horizon GraniteShares 3x Short is expected to generate 0.63 times more return on investment than BlackRock Latin. However, GraniteShares 3x Short is 1.58 times less risky than BlackRock Latin. It trades about 0.38 of its potential returns per unit of risk. BlackRock Latin American is currently generating about 0.21 per unit of risk. If you would invest  2,654  in GraniteShares 3x Short on October 22, 2024 and sell it today you would earn a total of  48.00  from holding GraniteShares 3x Short or generate 1.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	26.32%
Values	Daily Returns

GraniteShares 3x Short  vs.  BlackRock Latin American

GraniteShares 3x Short

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GraniteShares 3x Short has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

BlackRock Latin American

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BlackRock Latin American has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, BlackRock Latin 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 GraniteShares and BlackRock Latin

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

The idea behind GraniteShares 3x Short and BlackRock Latin American 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.

Check out your portfolio center.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.