Correlation Between Gladstone Investment and SK Growth
Can any of the company-specific risk be diversified away by investing in both Gladstone Investment and SK Growth 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 Gladstone Investment and SK Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Investment and SK Growth Opportunities, you can compare the effects of market volatilities on Gladstone Investment and SK Growth 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 Gladstone Investment with a short position of SK Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Investment and SK Growth.
Diversification Opportunities for Gladstone Investment and SK Growth
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gladstone and SKGR is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Investment and SK Growth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Growth Opportunities and Gladstone 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 Gladstone Investment are associated (or correlated) with SK Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Growth Opportunities has no effect on the direction of Gladstone Investment i.e., Gladstone Investment and SK Growth go up and down completely randomly.
Pair Corralation between Gladstone Investment and SK Growth
Given the investment horizon of 90 days Gladstone Investment is expected to generate 6.74 times more return on investment than SK Growth. However, Gladstone Investment is 6.74 times more volatile than SK Growth Opportunities. It trades about 0.03 of its potential returns per unit of risk. SK Growth Opportunities is currently generating about 0.15 per unit of risk. If you would invest 1,294 in Gladstone Investment on November 3, 2024 and sell it today you would earn a total of 57.00 from holding Gladstone Investment or generate 4.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gladstone Investment vs. SK Growth Opportunities
Performance |
| Timeline |
| Gladstone Investment |
| SK Growth Opportunities |
Gladstone Investment and SK Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Investment and SK Growth
The main advantage of trading using opposite Gladstone Investment and SK Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Investment position performs unexpectedly, SK Growth 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 SK Growth will offset losses from the drop in SK Growth's long position.| Gladstone Investment vs. PennantPark Floating Rate | Gladstone Investment vs. Horizon Technology Finance | Gladstone Investment vs. Stellus Capital Investment | Gladstone Investment vs. Prospect Capital |
| SK Growth vs. Four Leaf Acquisition | SK Growth vs. WinVest Acquisition Corp | SK Growth vs. Alpha One | SK Growth vs. Manaris Corp |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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