Correlation Between BlackRock Science and BlackRock Energy

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

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

Diversification Opportunities for BlackRock Science and BlackRock Energy

0.6

Correlation Coefficient

BlackRock Science  BlackRock Energy

Poor diversification

The 3 months correlation between BlackRock and BlackRock is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock Science and and BlackRock Energy and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlackRock Energy and BlackRock Science 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 Science and are associated (or correlated) with BlackRock Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlackRock Energy has no effect on the direction of BlackRock Science i.e., BlackRock Science and BlackRock Energy go up and down completely randomly.

Pair Corralation between BlackRock Science and BlackRock Energy

Given the investment horizon of 90 days BlackRock Science and is expected to generate 0.99 times more return on investment than BlackRock Energy. However, BlackRock Science and is 1.01 times less risky than BlackRock Energy. It trades about 0.4 of its potential returns per unit of risk. BlackRock Energy and is currently generating about 0.18 per unit of risk. If you would invest  1,755  in BlackRock Science and on May 7, 2025 and sell it today you would earn a total of  389.00  from holding BlackRock Science and or generate 22.17% return on investment over 90 days.

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

BlackRock Science and  vs.  BlackRock Energy and

BlackRock Science

Risk-Adjusted Performance

High

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock Science and are ranked lower than 31 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, BlackRock Science showed solid returns over the last few months and may actually be approaching a breakup point.

BlackRock Energy

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock Energy and are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively sluggish technical and fundamental indicators, BlackRock Energy may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with BlackRock Science and BlackRock Energy

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

The idea behind BlackRock Science and and BlackRock Energy and 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.