Correlation Between BLZ and FileCoin

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

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

Diversification Opportunities for BLZ and FileCoin

0.8

Correlation Coefficient

BLZ  FileCoin

Very poor diversification

The 3 months correlation between BLZ and FileCoin is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding BLZ and FileCoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FileCoin and BLZ 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 BLZ are associated (or correlated) with FileCoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FileCoin has no effect on the direction of BLZ i.e., BLZ and FileCoin go up and down completely randomly.

Pair Corralation between BLZ and FileCoin

Assuming the 90 days trading horizon BLZ is expected to generate 1.04 times more return on investment than FileCoin. However, BLZ is 1.04 times more volatile than FileCoin. It trades about 0.05 of its potential returns per unit of risk. FileCoin is currently generating about 0.02 per unit of risk. If you would invest  3.31  in BLZ on April 20, 2025 and sell it today you would earn a total of  0.28  from holding BLZ or generate 8.46% return on investment over 90 days.

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

BLZ  vs.  FileCoin

BLZ

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in BLZ are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, BLZ exhibited solid returns over the last few months and may actually be approaching a breakup point.

FileCoin

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FileCoin are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound essential indicators, FileCoin is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with BLZ and FileCoin

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

The idea behind BLZ and FileCoin 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.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.