Correlation Between Blackrock Balanced and Mkeax

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

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

Diversification Opportunities for Blackrock Balanced and Mkeax

0.97

Correlation Coefficient

Blackrock Balanced  Mkeax

Almost no diversification

The 3 months correlation between Blackrock and Mkeax is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Balanced Capital and Mkeax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mkeax and Blackrock Balanced 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 Balanced Capital are associated (or correlated) with Mkeax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mkeax has no effect on the direction of Blackrock Balanced i.e., Blackrock Balanced and Mkeax go up and down completely randomly.

Pair Corralation between Blackrock Balanced and Mkeax

Assuming the 90 days horizon Blackrock Balanced is expected to generate 1.55 times less return on investment than Mkeax. But when comparing it to its historical volatility, Blackrock Balanced Capital is 2.23 times less risky than Mkeax. It trades about 0.27 of its potential returns per unit of risk. Mkeax is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  1,379  in Mkeax on May 6, 2025 and sell it today you would earn a total of  148.00  from holding Mkeax or generate 10.73% return on investment over 90 days.

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

Blackrock Balanced Capital  vs.  Mkeax

Blackrock Balanced

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Balanced Capital are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Blackrock Balanced may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Mkeax

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mkeax are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Mkeax may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Blackrock Balanced and Mkeax

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

The idea behind Blackrock Balanced Capital and Mkeax 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.