Correlation Between Oxford Lane and Gladstone Land

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

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

Diversification Opportunities for Oxford Lane and Gladstone Land

0.0

Correlation Coefficient

Oxford Lane  Gladstone Land

Pay attention - limited upside

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

Pair Corralation between Oxford Lane and Gladstone Land

If you would invest  2,433  in Gladstone Land Corp on December 30, 2024 and sell it today you would earn a total of  55.00  from holding Gladstone Land Corp or generate 2.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Oxford Lane Capital  vs.  Gladstone Land Corp

Oxford Lane Capital

Risk-Adjusted Performance

Very Weak

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

Gladstone Land Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gladstone Land Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental indicators, Gladstone Land is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Oxford Lane and Gladstone Land

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

The idea behind Oxford Lane Capital and Gladstone Land Corp 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.