Correlation Between GCM Grosvenor and OFS Credit
Can any of the company-specific risk be diversified away by investing in both GCM Grosvenor and OFS Credit 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 GCM Grosvenor and OFS Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GCM Grosvenor and OFS Credit, you can compare the effects of market volatilities on GCM Grosvenor and OFS Credit 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 GCM Grosvenor with a short position of OFS Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of GCM Grosvenor and OFS Credit.
Diversification Opportunities for GCM Grosvenor and OFS Credit
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GCM and OFS is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding GCM Grosvenor and OFS Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFS Credit and GCM Grosvenor 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 GCM Grosvenor are associated (or correlated) with OFS Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFS Credit has no effect on the direction of GCM Grosvenor i.e., GCM Grosvenor and OFS Credit go up and down completely randomly.
Pair Corralation between GCM Grosvenor and OFS Credit
Given the investment horizon of 90 days GCM Grosvenor is expected to generate 1.74 times more return on investment than OFS Credit. However, GCM Grosvenor is 1.74 times more volatile than OFS Credit. It trades about 0.19 of its potential returns per unit of risk. OFS Credit is currently generating about 0.12 per unit of risk. If you would invest 1,140 in GCM Grosvenor on November 1, 2024 and sell it today you would earn a total of 206.00 from holding GCM Grosvenor or generate 18.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GCM Grosvenor vs. OFS Credit
Performance |
| Timeline |
| GCM Grosvenor |
| OFS Credit |
GCM Grosvenor and OFS Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GCM Grosvenor and OFS Credit
The main advantage of trading using opposite GCM Grosvenor and OFS Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GCM Grosvenor position performs unexpectedly, OFS Credit 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 OFS Credit will offset losses from the drop in OFS Credit's long position.| GCM Grosvenor vs. Blue Owl Capital | GCM Grosvenor vs. TPG Inc | GCM Grosvenor vs. Patria Investments | GCM Grosvenor vs. Cion Investment Corp |
| OFS Credit vs. WhiteHorse Finance | OFS Credit vs. Monroe Capital Corp | OFS Credit vs. Portman Ridge Finance | OFS Credit vs. Fidus Investment 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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