Correlation Between Western Asset and Blackstone Gso

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

By analyzing existing cross correlation between Western Asset Diversified and Blackstone Gso Strategic, you can compare the effects of market volatilities on Western Asset and Blackstone Gso 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 Western Asset with a short position of Blackstone Gso. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Blackstone Gso.

Diversification Opportunities for Western Asset and Blackstone Gso

0.73

Correlation Coefficient

Western Asset  Blackstone Gso

Poor diversification

The 3 months correlation between Western and Blackstone is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Diversified and Blackstone Gso Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Gso Strategic and Western Asset 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 Western Asset Diversified are associated (or correlated) with Blackstone Gso. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Gso Strategic has no effect on the direction of Western Asset i.e., Western Asset and Blackstone Gso go up and down completely randomly.

Pair Corralation between Western Asset and Blackstone Gso

Considering the 90-day investment horizon Western Asset Diversified is expected to generate 1.27 times more return on investment than Blackstone Gso. However, Western Asset is 1.27 times more volatile than Blackstone Gso Strategic. It trades about 0.15 of its potential returns per unit of risk. Blackstone Gso Strategic is currently generating about 0.01 per unit of risk. If you would invest  1,378  in Western Asset Diversified on December 29, 2024 and sell it today you would earn a total of  68.00  from holding Western Asset Diversified or generate 4.93% return on investment over 90 days.

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

Western Asset Diversified  vs.  Blackstone Gso Strategic

Western Asset Diversified

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Western Asset Diversified are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, Western Asset is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Blackstone Gso Strategic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blackstone Gso Strategic has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong technical and fundamental indicators, Blackstone Gso is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Western Asset and Blackstone Gso

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

The idea behind Western Asset Diversified and Blackstone Gso Strategic 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 Commodity Directory module to find actively traded commodities issued by global exchanges.