Correlation Between Top Frontier and SLR Investment

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

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

Diversification Opportunities for Top Frontier and SLR Investment

0.0

Correlation Coefficient

Top Frontier  SLR Investment

Pay attention - limited upside

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

Pair Corralation between Top Frontier and SLR Investment

If you would invest  1,623  in SLR Investment Corp on October 25, 2024 and sell it today you would earn a total of  50.00  from holding SLR Investment Corp or generate 3.08% return on investment over 90 days.

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

Top Frontier Investment  vs.  SLR Investment Corp

Top Frontier Investment

Risk-Adjusted Performance

0 of 100

Very Weak

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

SLR Investment Corp

Risk-Adjusted Performance

16 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SLR Investment Corp are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, SLR Investment may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Top Frontier and SLR Investment

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

The idea behind Top Frontier Investment and SLR Investment 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.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.