Correlation Between OFS Capital and Investcorp Credit
Can any of the company-specific risk be diversified away by investing in both OFS Capital and Investcorp Credit 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 OFS Capital and Investcorp Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OFS Capital Corp and Investcorp Credit Management, you can compare the effects of market volatilities on OFS Capital and Investcorp Credit 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 OFS Capital with a short position of Investcorp Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of OFS Capital and Investcorp Credit.
Diversification Opportunities for OFS Capital and Investcorp Credit
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between OFS and Investcorp is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding OFS Capital Corp and Investcorp Credit Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investcorp Credit and OFS Capital 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 OFS Capital Corp are associated (or correlated) with Investcorp Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investcorp Credit has no effect on the direction of OFS Capital i.e., OFS Capital and Investcorp Credit go up and down completely randomly.
Pair Corralation between OFS Capital and Investcorp Credit
Considering the 90-day investment horizon OFS Capital Corp is expected to generate 1.67 times more return on investment than Investcorp Credit. However, OFS Capital is 1.67 times more volatile than Investcorp Credit Management. It trades about 0.17 of its potential returns per unit of risk. Investcorp Credit Management is currently generating about 0.11 per unit of risk. If you would invest 763.00 in OFS Capital Corp on December 28, 2024 and sell it today you would earn a total of 136.00 from holding OFS Capital Corp or generate 17.82% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 98.36% |
Values | Daily Returns |
OFS Capital Corp vs. Investcorp Credit Management
Performance |
Timeline |
OFS Capital Corp |
Investcorp Credit |
OFS Capital and Investcorp Credit Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with OFS Capital and Investcorp Credit
The main advantage of trading using opposite OFS Capital and Investcorp Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OFS Capital position performs unexpectedly, Investcorp Credit 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 Investcorp Credit will offset losses from the drop in Investcorp Credit's long position.OFS Capital vs. Stellus Capital Investment | OFS Capital vs. Fidus Investment Corp | OFS Capital vs. Monroe Capital Corp | OFS Capital vs. New Mountain Finance |
Investcorp Credit vs. Presidio Property Trust | Investcorp Credit vs. Great Elm Capital | Investcorp Credit vs. Portman Ridge Finance | Investcorp Credit vs. OFS Capital Corp |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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