Correlation Between BlackRock TCP and Intermediate Capital

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

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

Diversification Opportunities for BlackRock TCP and Intermediate Capital

0.0

Correlation Coefficient

BlackRock TCP  Intermediate Capital

Pay attention - limited upside

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

Pair Corralation between BlackRock TCP and Intermediate Capital

If you would invest  789.00  in BlackRock TCP Capital on October 23, 2024 and sell it today you would earn a total of  106.00  from holding BlackRock TCP Capital or generate 13.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

BlackRock TCP Capital  vs.  Intermediate Capital Group

BlackRock TCP Capital

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock TCP Capital are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, BlackRock TCP exhibited solid returns over the last few months and may actually be approaching a breakup point.

Intermediate Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intermediate Capital Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Intermediate Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with BlackRock TCP and Intermediate Capital

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

The idea behind BlackRock TCP Capital and Intermediate Capital 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.