Correlation Between Cion Investment and TPG

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

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

Diversification Opportunities for Cion Investment and TPG

-0.31

Correlation Coefficient

Cion Investment  TPG

Very good diversification

The 3 months correlation between Cion and TPG is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Cion Investment Corp and TPG Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TPG Inc and Cion Investment 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 Cion Investment Corp are associated (or correlated) with TPG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TPG Inc has no effect on the direction of Cion Investment i.e., Cion Investment and TPG go up and down completely randomly.

Pair Corralation between Cion Investment and TPG

Given the investment horizon of 90 days Cion Investment Corp is expected to generate 0.53 times more return on investment than TPG. However, Cion Investment Corp is 1.88 times less risky than TPG. It trades about -0.05 of its potential returns per unit of risk. TPG Inc is currently generating about -0.15 per unit of risk. If you would invest  1,134  in Cion Investment Corp on December 27, 2024 and sell it today you would lose (50.00) from holding Cion Investment Corp or give up 4.41% of portfolio value over 90 days.

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

Cion Investment Corp  vs.  TPG Inc

Cion Investment Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cion Investment Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Cion Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

TPG Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days TPG Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Cion Investment and TPG

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

The idea behind Cion Investment Corp and TPG Inc 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.