Correlation Between Cliffwater Corporate and Intrepid Capital

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

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

Diversification Opportunities for Cliffwater Corporate and Intrepid Capital

0.0

Correlation Coefficient

Cliffwater Corporate  Intrepid Capital

Pay attention - limited upside

The 3 months correlation between Cliffwater and Intrepid is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cliffwater Corporate Lending and Intrepid Capital Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intrepid Capital and Cliffwater Corporate 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 Cliffwater Corporate Lending are associated (or correlated) with Intrepid Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intrepid Capital has no effect on the direction of Cliffwater Corporate i.e., Cliffwater Corporate and Intrepid Capital go up and down completely randomly.

Pair Corralation between Cliffwater Corporate and Intrepid Capital

If you would invest  1,062  in Cliffwater Corporate Lending on December 29, 2024 and sell it today you would earn a total of  23.00  from holding Cliffwater Corporate Lending or generate 2.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.64%
Values	Daily Returns

Cliffwater Corporate Lending  vs.  Intrepid Capital Fund

Cliffwater Corporate

Risk-Adjusted Performance

Excellent

Compared to the overall equity markets, risk-adjusted returns on investments in Cliffwater Corporate Lending are ranked lower than 53 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Cliffwater Corporate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Intrepid Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Intrepid Capital Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Intrepid Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cliffwater Corporate and Intrepid Capital

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

The idea behind Cliffwater Corporate Lending and Intrepid Capital Fund 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.