Correlation Between BlackRock Capital and CSB Bancorp

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

By analyzing existing cross correlation between BlackRock Capital Allocation and CSB Bancorp, you can compare the effects of market volatilities on BlackRock Capital and CSB Bancorp 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 Capital with a short position of CSB Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock Capital and CSB Bancorp.

Diversification Opportunities for BlackRock Capital and CSB Bancorp

0.88

Correlation Coefficient

BlackRock Capital  CSB Bancorp

Very poor diversification

The 3 months correlation between BlackRock and CSB is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock Capital Allocation and CSB Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSB Bancorp and BlackRock Capital 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 Capital Allocation are associated (or correlated) with CSB Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSB Bancorp has no effect on the direction of BlackRock Capital i.e., BlackRock Capital and CSB Bancorp go up and down completely randomly.

Pair Corralation between BlackRock Capital and CSB Bancorp

Given the investment horizon of 90 days BlackRock Capital is expected to generate 1.13 times less return on investment than CSB Bancorp. But when comparing it to its historical volatility, BlackRock Capital Allocation is 1.23 times less risky than CSB Bancorp. It trades about 0.16 of its potential returns per unit of risk. CSB Bancorp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  4,100  in CSB Bancorp on May 2, 2025 and sell it today you would earn a total of  300.00  from holding CSB Bancorp or generate 7.32% return on investment over 90 days.

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

BlackRock Capital Allocation  vs.  CSB Bancorp

BlackRock Capital

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock Capital Allocation are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, BlackRock Capital may actually be approaching a critical reversion point that can send shares even higher in August 2025.

CSB Bancorp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CSB Bancorp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent fundamental drivers, CSB Bancorp may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with BlackRock Capital and CSB Bancorp

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

The idea behind BlackRock Capital Allocation and CSB Bancorp 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.