Correlation Between Monroe Capital and CBH
Can any of the company-specific risk be diversified away by investing in both Monroe Capital and CBH 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 Monroe Capital and CBH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monroe Capital Corp and CBH, you can compare the effects of market volatilities on Monroe Capital and CBH 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 Monroe Capital with a short position of CBH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monroe Capital and CBH.
Diversification Opportunities for Monroe Capital and CBH
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Monroe and CBH is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Monroe Capital Corp and CBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBH and Monroe Capital 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 Monroe Capital Corp are associated (or correlated) with CBH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBH has no effect on the direction of Monroe Capital i.e., Monroe Capital and CBH go up and down completely randomly.
Pair Corralation between Monroe Capital and CBH
If you would invest 782.00 in Monroe Capital Corp on August 24, 2024 and sell it today you would earn a total of 62.00 from holding Monroe Capital Corp or generate 7.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Monroe Capital Corp vs. CBH
Performance |
| Timeline |
| Monroe Capital Corp |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Monroe Capital and CBH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monroe Capital and CBH
The main advantage of trading using opposite Monroe Capital and CBH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monroe Capital position performs unexpectedly, CBH 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 CBH will offset losses from the drop in CBH's long position.| Monroe Capital vs. WhiteHorse Finance | Monroe Capital vs. OFS Capital Corp | Monroe Capital vs. Fidus Investment Corp | Monroe Capital vs. BlackRock TCP Capital |
| CBH vs. MFS Investment Grade | CBH vs. Invesco High Income | CBH vs. Eaton Vance National | CBH vs. Nuveen California Select |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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