Correlation Between PNC Financial and Blackstone
Can any of the company-specific risk be diversified away by investing in both PNC Financial 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 PNC Financial and Blackstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PNC Financial Services and Blackstone Group, you can compare the effects of market volatilities on PNC Financial 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 PNC Financial with a short position of Blackstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of PNC Financial and Blackstone.
Diversification Opportunities for PNC Financial and Blackstone
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PNC and Blackstone is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding PNC Financial Services and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group and PNC Financial 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 PNC Financial Services 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 PNC Financial i.e., PNC Financial and Blackstone go up and down completely randomly.
Pair Corralation between PNC Financial and Blackstone
Considering the 90-day investment horizon PNC Financial Services is expected to generate 0.92 times more return on investment than Blackstone. However, PNC Financial Services is 1.09 times less risky than Blackstone. It trades about 0.06 of its potential returns per unit of risk. Blackstone Group is currently generating about 0.01 per unit of risk. If you would invest 15,007 in PNC Financial Services on January 26, 2024 and sell it today you would earn a total of 799.00 from holding PNC Financial Services or generate 5.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PNC Financial Services vs. Blackstone Group
Performance |
| Timeline |
| PNC Financial Services |
| Blackstone Group |
PNC Financial and Blackstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PNC Financial and Blackstone
The main advantage of trading using opposite PNC Financial and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PNC Financial 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.The idea behind PNC Financial Services and Blackstone Group 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.| Blackstone vs. Federated Premier Municipal | Blackstone vs. Blackrock Muniyield | Blackstone vs. NXG NextGen Infrastructure | Blackstone vs. Brightsphere Investment Group |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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