Correlation Between Echelon Prime and BLZ

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

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

Diversification Opportunities for Echelon Prime and BLZ

0.83

Correlation Coefficient

Echelon Prime  BLZ

Very poor diversification

The 3 months correlation between Echelon and BLZ is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Echelon Prime and BLZ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLZ and Echelon Prime 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 Echelon Prime are associated (or correlated) with BLZ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLZ has no effect on the direction of Echelon Prime i.e., Echelon Prime and BLZ go up and down completely randomly.

Pair Corralation between Echelon Prime and BLZ

Assuming the 90 days trading horizon Echelon Prime is expected to generate 3.68 times less return on investment than BLZ. In addition to that, Echelon Prime is 1.7 times more volatile than BLZ. It trades about 0.01 of its total potential returns per unit of risk. BLZ is currently generating about 0.04 per unit of volatility. If you would invest  3.52  in BLZ on April 23, 2025 and sell it today you would earn a total of  0.19  from holding BLZ or generate 5.4% return on investment over 90 days.

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

Echelon Prime  vs.  BLZ

Echelon Prime

Risk-Adjusted Performance

Very Weak

Over the last 90 days Echelon Prime has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Echelon Prime is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

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 may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Echelon Prime and BLZ

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

The idea behind Echelon Prime and BLZ 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.