Correlation Between Simplify Macro and Blackrock Mid

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

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

Diversification Opportunities for Simplify Macro and Blackrock Mid

0.3

Correlation Coefficient

Simplify Macro  Blackrock Mid

Weak diversification

The 3 months correlation between Simplify and Blackrock is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Simplify Macro Strategy and Blackrock Mid Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Mid Cap and Simplify Macro 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 Simplify Macro Strategy are associated (or correlated) with Blackrock Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Mid Cap has no effect on the direction of Simplify Macro i.e., Simplify Macro and Blackrock Mid go up and down completely randomly.

Pair Corralation between Simplify Macro and Blackrock Mid

Considering the 90-day investment horizon Simplify Macro Strategy is expected to generate 0.5 times more return on investment than Blackrock Mid. However, Simplify Macro Strategy is 1.98 times less risky than Blackrock Mid. It trades about 0.06 of its potential returns per unit of risk. Blackrock Mid Cap Growth is currently generating about -0.05 per unit of risk. If you would invest  2,148  in Simplify Macro Strategy on February 3, 2025 and sell it today you would earn a total of  114.00  from holding Simplify Macro Strategy or generate 5.31% return on investment over 90 days.

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

Simplify Macro Strategy  vs.  Blackrock Mid Cap Growth

Simplify Macro Strategy

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Simplify Macro Strategy are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable forward indicators, Simplify Macro is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Blackrock Mid Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blackrock Mid Cap Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward-looking signals remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Simplify Macro and Blackrock Mid

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

The idea behind Simplify Macro Strategy and Blackrock Mid Cap Growth 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.