Correlation Between Cornerstone Strategic and XAI Octagon
Can any of the company-specific risk be diversified away by investing in both Cornerstone Strategic and XAI Octagon 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 Cornerstone Strategic and XAI Octagon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cornerstone Strategic Value and XAI Octagon Floating, you can compare the effects of market volatilities on Cornerstone Strategic and XAI Octagon 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 Cornerstone Strategic with a short position of XAI Octagon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cornerstone Strategic and XAI Octagon.
Diversification Opportunities for Cornerstone Strategic and XAI Octagon
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cornerstone and XAI is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Cornerstone Strategic Value and XAI Octagon Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XAI Octagon Floating and Cornerstone Strategic 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 Cornerstone Strategic Value are associated (or correlated) with XAI Octagon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XAI Octagon Floating has no effect on the direction of Cornerstone Strategic i.e., Cornerstone Strategic and XAI Octagon go up and down completely randomly.
Pair Corralation between Cornerstone Strategic and XAI Octagon
Considering the 90-day investment horizon Cornerstone Strategic Value is expected to generate 1.14 times more return on investment than XAI Octagon. However, Cornerstone Strategic is 1.14 times more volatile than XAI Octagon Floating. It trades about 0.08 of its potential returns per unit of risk. XAI Octagon Floating is currently generating about 0.07 per unit of risk. If you would invest 582.00 in Cornerstone Strategic Value on August 24, 2024 and sell it today you would earn a total of 297.00 from holding Cornerstone Strategic Value or generate 51.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cornerstone Strategic Value vs. XAI Octagon Floating
Performance |
| Timeline |
| Cornerstone Strategic |
| XAI Octagon Floating |
Cornerstone Strategic and XAI Octagon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cornerstone Strategic and XAI Octagon
The main advantage of trading using opposite Cornerstone Strategic and XAI Octagon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cornerstone Strategic position performs unexpectedly, XAI Octagon 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 XAI Octagon will offset losses from the drop in XAI Octagon's long position.| Cornerstone Strategic vs. MFS Investment Grade | Cornerstone Strategic vs. Eaton Vance National | Cornerstone Strategic vs. Blackrock Muniyield Quality | Cornerstone Strategic vs. Munivest Fund |
| XAI Octagon vs. Oxford Lane Capital | XAI Octagon vs. Capital Southwest | XAI Octagon vs. Cornerstone Strategic Return | XAI Octagon vs. Cornerstone Strategic Value |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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