Correlation Between Oxford Square and Carlyle

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

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

Diversification Opportunities for Oxford Square and Carlyle

-0.38

Correlation Coefficient

Oxford Square  Carlyle

Very good diversification

The 3 months correlation between Oxford and Carlyle is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Square Capital and The Carlyle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlyle Group and Oxford Square 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 Square Capital are associated (or correlated) with Carlyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlyle Group has no effect on the direction of Oxford Square i.e., Oxford Square and Carlyle go up and down completely randomly.

Pair Corralation between Oxford Square and Carlyle

Assuming the 90 days horizon Oxford Square Capital is expected to generate 0.43 times more return on investment than Carlyle. However, Oxford Square Capital is 2.33 times less risky than Carlyle. It trades about -0.02 of its potential returns per unit of risk. The Carlyle Group is currently generating about -0.3 per unit of risk. If you would invest  2,321  in Oxford Square Capital on September 24, 2024 and sell it today you would lose (3.99) from holding Oxford Square Capital or give up 0.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Oxford Square Capital  vs.  The Carlyle Group

Oxford Square Capital

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Oxford Square Capital are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Oxford Square is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Carlyle Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days The Carlyle Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental drivers remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Oxford Square and Carlyle

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

The idea behind Oxford Square Capital and The Carlyle Group 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.