Correlation Between Mkeax and Blackrock Mid

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

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

Diversification Opportunities for Mkeax and Blackrock Mid

0.8

Correlation Coefficient

Mkeax  Blackrock Mid

Very poor diversification

The 3 months correlation between Mkeax and Blackrock is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Mkeax 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 Mkeax 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 Mkeax 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 Mkeax i.e., Mkeax and Blackrock Mid go up and down completely randomly.

Pair Corralation between Mkeax and Blackrock Mid

Assuming the 90 days horizon Mkeax is expected to generate 0.83 times more return on investment than Blackrock Mid. However, Mkeax is 1.2 times less risky than Blackrock Mid. It trades about 0.19 of its potential returns per unit of risk. Blackrock Mid Cap Growth is currently generating about 0.12 per unit of risk. If you would invest  1,379  in Mkeax on May 7, 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	Strong
Accuracy	100.0%
Values	Daily Returns

Mkeax  vs.  Blackrock Mid Cap Growth

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.

Blackrock Mid Cap

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Mid Cap Growth are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward-looking signals, Blackrock Mid may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Mkeax and Blackrock Mid

The main advantage of trading using opposite Mkeax and Blackrock Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mkeax 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 Mkeax 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.