Correlation Between Blackrock Government and Western Asset
Can any of the company-specific risk be diversified away by investing in both Blackrock Government and Western Asset 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 Government and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Government Bond and Western Asset Short, you can compare the effects of market volatilities on Blackrock Government and Western Asset 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 Government with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Government and Western Asset.
Diversification Opportunities for Blackrock Government and Western Asset
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Blackrock and Western is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Government Bond and Western Asset Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Short and Blackrock Government 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 Government Bond are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Short has no effect on the direction of Blackrock Government i.e., Blackrock Government and Western Asset go up and down completely randomly.
Pair Corralation between Blackrock Government and Western Asset
Assuming the 90 days horizon Blackrock Government Bond is expected to generate 3.63 times more return on investment than Western Asset. However, Blackrock Government is 3.63 times more volatile than Western Asset Short. It trades about 0.22 of its potential returns per unit of risk. Western Asset Short is currently generating about 0.39 per unit of risk. If you would invest 897.00 in Blackrock Government Bond on June 11, 2025 and sell it today you would earn a total of 37.00 from holding Blackrock Government Bond or generate 4.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Government Bond vs. Western Asset Short
Performance |
| Timeline |
| Blackrock Government Bond |
| Western Asset Short |
Blackrock Government and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Government and Western Asset
The main advantage of trading using opposite Blackrock Government and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Government position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Blackrock Government vs. Blackrock California Municipal | Blackrock Government vs. Blackrock Balanced Capital | Blackrock Government vs. Blackrock Eurofund Class | Blackrock Government vs. Blackrock Funds |
| Western Asset vs. Franklin Mutual Beacon | Western Asset vs. Templeton Developing Markets | Western Asset vs. Franklin Mutual Global | Western Asset vs. Franklin Mutual Global |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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