Correlation Between Bank of New York and Blackstone
Can any of the company-specific risk be diversified away by investing in both Bank of New York and Blackstone 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 Bank of New York and Blackstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of New and Blackstone Group, you can compare the effects of market volatilities on Bank of New York and Blackstone 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 Bank of New York with a short position of Blackstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of New York and Blackstone.
Diversification Opportunities for Bank of New York and Blackstone
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Blackstone is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Bank of New and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group and Bank of New York 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 Bank of New are associated (or correlated) with Blackstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Group has no effect on the direction of Bank of New York i.e., Bank of New York and Blackstone go up and down completely randomly.
Pair Corralation between Bank of New York and Blackstone
Allowing for the 90-day total investment horizon Bank of New is expected to generate 0.59 times more return on investment than Blackstone. However, Bank of New is 1.71 times less risky than Blackstone. It trades about 0.09 of its potential returns per unit of risk. Blackstone Group is currently generating about -0.08 per unit of risk. If you would invest 5,654 in Bank of New on January 25, 2024 and sell it today you would earn a total of 116.00 from holding Bank of New or generate 2.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of New vs. Blackstone Group
Performance |
| Timeline |
| Bank of New York |
| Blackstone Group |
Bank of New York and Blackstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of New York and Blackstone
The main advantage of trading using opposite Bank of New York and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of New York position performs unexpectedly, Blackstone 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 will offset losses from the drop in Blackstone's long position.| Bank of New York vs. Federated Premier Municipal | Bank of New York vs. Blackrock Muniyield | Bank of New York vs. Diamond Hill Investment | Bank of New York vs. NXG NextGen Infrastructure |
| Blackstone vs. T Rowe Price | Blackstone vs. State Street Corp | Blackstone vs. KKR Co LP | Blackstone vs. Brookfield Asset Management |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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