Correlation Between SLR Investment and Boeing

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

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

Diversification Opportunities for SLR Investment and Boeing

0.07

Correlation Coefficient

SLR Investment  Boeing

Significant diversification

The 3 months correlation between SLR and Boeing is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding SLR Investment Corp and The Boeing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boeing and SLR Investment 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 SLR Investment Corp are associated (or correlated) with Boeing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boeing has no effect on the direction of SLR Investment i.e., SLR Investment and Boeing go up and down completely randomly.

Pair Corralation between SLR Investment and Boeing

Assuming the 90 days horizon SLR Investment Corp is expected to generate 0.44 times more return on investment than Boeing. However, SLR Investment Corp is 2.3 times less risky than Boeing. It trades about 0.03 of its potential returns per unit of risk. The Boeing is currently generating about -0.04 per unit of risk. If you would invest  1,505  in SLR Investment Corp on December 20, 2024 and sell it today you would earn a total of  24.00  from holding SLR Investment Corp or generate 1.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

SLR Investment Corp  vs.  The Boeing

SLR Investment Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SLR Investment Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, SLR Investment is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Boeing

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Boeing has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with SLR Investment and Boeing

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

The idea behind SLR Investment Corp and The Boeing 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..