Correlation Between Blackrock Exchange and Oakmark International

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

By analyzing existing cross correlation between Blackrock Exchange Portfolio and Oakmark International Fund, you can compare the effects of market volatilities on Blackrock Exchange and Oakmark International 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 Exchange with a short position of Oakmark International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Exchange and Oakmark International.

Diversification Opportunities for Blackrock Exchange and Oakmark International

0.23

Correlation Coefficient

Blackrock Exchange  Oakmark International

Modest diversification

The 3 months correlation between Blackrock and Oakmark is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Exchange Portfolio and Oakmark International Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark International and Blackrock Exchange 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 Exchange Portfolio are associated (or correlated) with Oakmark International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark International has no effect on the direction of Blackrock Exchange i.e., Blackrock Exchange and Oakmark International go up and down completely randomly.

Pair Corralation between Blackrock Exchange and Oakmark International

Assuming the 90 days horizon Blackrock Exchange is expected to generate 23.39 times less return on investment than Oakmark International. But when comparing it to its historical volatility, Blackrock Exchange Portfolio is 1.45 times less risky than Oakmark International. It trades about 0.01 of its potential returns per unit of risk. Oakmark International Fund is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  2,476  in Oakmark International Fund on December 23, 2024 and sell it today you would earn a total of  305.00  from holding Oakmark International Fund or generate 12.32% return on investment over 90 days.

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

Blackrock Exchange Portfolio  vs.  Oakmark International Fund

Blackrock Exchange

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blackrock Exchange Portfolio has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Blackrock Exchange is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Oakmark International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Oakmark International Fund are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Oakmark International may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Blackrock Exchange and Oakmark International

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

The idea behind Blackrock Exchange Portfolio and Oakmark International Fund 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.