Correlation Between Monroe Capital and Phenixfin
Can any of the company-specific risk be diversified away by investing in both Monroe Capital and Phenixfin 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 Phenixfin 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 Phenixfin, you can compare the effects of market volatilities on Monroe Capital and Phenixfin 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 Phenixfin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monroe Capital and Phenixfin.
Diversification Opportunities for Monroe Capital and Phenixfin
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Monroe and Phenixfin is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Monroe Capital Corp and Phenixfin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phenixfin 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 Phenixfin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phenixfin has no effect on the direction of Monroe Capital i.e., Monroe Capital and Phenixfin go up and down completely randomly.
Pair Corralation between Monroe Capital and Phenixfin
Given the investment horizon of 90 days Monroe Capital Corp is expected to generate 0.48 times more return on investment than Phenixfin. However, Monroe Capital Corp is 2.08 times less risky than Phenixfin. It trades about 0.2 of its potential returns per unit of risk. Phenixfin is currently generating about -0.02 per unit of risk. If you would invest 807.00 in Monroe Capital Corp on August 31, 2024 and sell it today you would earn a total of 35.00 from holding Monroe Capital Corp or generate 4.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monroe Capital Corp vs. Phenixfin
Performance |
| Timeline |
| Monroe Capital Corp |
| Phenixfin |
Monroe Capital and Phenixfin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monroe Capital and Phenixfin
The main advantage of trading using opposite Monroe Capital and Phenixfin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monroe Capital position performs unexpectedly, Phenixfin 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 Phenixfin will offset losses from the drop in Phenixfin'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 |
| Phenixfin vs. MFS Investment Grade | Phenixfin vs. Eaton Vance National | Phenixfin vs. Invesco High Income | Phenixfin vs. Federated Premier Municipal |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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