Correlation Between Blackrock Small and Calvert Bond

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

By analyzing existing cross correlation between Blackrock Small Cap and Calvert Bond Portfolio, you can compare the effects of market volatilities on Blackrock Small and Calvert Bond 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 Small with a short position of Calvert Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Small and Calvert Bond.

Diversification Opportunities for Blackrock Small and Calvert Bond

0.86

Correlation Coefficient

Blackrock Small  Calvert Bond

Very poor diversification

The 3 months correlation between Blackrock and Calvert is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Small Cap and Calvert Bond Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Bond Portfolio and Blackrock Small 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 Small Cap are associated (or correlated) with Calvert Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Bond Portfolio has no effect on the direction of Blackrock Small i.e., Blackrock Small and Calvert Bond go up and down completely randomly.

Pair Corralation between Blackrock Small and Calvert Bond

Assuming the 90 days horizon Blackrock Small Cap is expected to generate 3.63 times more return on investment than Calvert Bond. However, Blackrock Small is 3.63 times more volatile than Calvert Bond Portfolio. It trades about 0.14 of its potential returns per unit of risk. Calvert Bond Portfolio is currently generating about 0.15 per unit of risk. If you would invest  1,294  in Blackrock Small Cap on May 19, 2025 and sell it today you would earn a total of  114.00  from holding Blackrock Small Cap or generate 8.81% return on investment over 90 days.

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

Blackrock Small Cap  vs.  Calvert Bond Portfolio

Blackrock Small Cap

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Small Cap are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Blackrock Small may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Calvert Bond Portfolio

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert Bond Portfolio are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Calvert Bond is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Blackrock Small and Calvert Bond

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

The idea behind Blackrock Small Cap and Calvert Bond Portfolio 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..