Correlation Between OFS Credit and Carlyle Secured
Can any of the company-specific risk be diversified away by investing in both OFS Credit and Carlyle Secured 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 OFS Credit and Carlyle Secured into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OFS Credit and Carlyle Secured Lending, you can compare the effects of market volatilities on OFS Credit and Carlyle Secured 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 OFS Credit with a short position of Carlyle Secured. Check out your portfolio center. Please also check ongoing floating volatility patterns of OFS Credit and Carlyle Secured.
Diversification Opportunities for OFS Credit and Carlyle Secured
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between OFS and Carlyle is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding OFS Credit and Carlyle Secured Lending in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlyle Secured Lending and OFS Credit 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 OFS Credit are associated (or correlated) with Carlyle Secured. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlyle Secured Lending has no effect on the direction of OFS Credit i.e., OFS Credit and Carlyle Secured go up and down completely randomly.
Pair Corralation between OFS Credit and Carlyle Secured
Given the investment horizon of 90 days OFS Credit is expected to generate 5.45 times less return on investment than Carlyle Secured. In addition to that, OFS Credit is 1.39 times more volatile than Carlyle Secured Lending. It trades about 0.01 of its total potential returns per unit of risk. Carlyle Secured Lending is currently generating about 0.09 per unit of volatility. If you would invest 1,243 in Carlyle Secured Lending on August 31, 2024 and sell it today you would earn a total of 490.00 from holding Carlyle Secured Lending or generate 39.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OFS Credit vs. Carlyle Secured Lending
Performance |
| Timeline |
| OFS Credit |
| Carlyle Secured Lending |
OFS Credit and Carlyle Secured Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OFS Credit and Carlyle Secured
The main advantage of trading using opposite OFS Credit and Carlyle Secured positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OFS Credit position performs unexpectedly, Carlyle Secured 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 Carlyle Secured will offset losses from the drop in Carlyle Secured's long position.| OFS Credit vs. WhiteHorse Finance | OFS Credit vs. Monroe Capital Corp | OFS Credit vs. Portman Ridge Finance | OFS Credit vs. Fidus Investment Corp |
| Carlyle Secured vs. Sixth Street Specialty | Carlyle Secured vs. Golub Capital BDC | Carlyle Secured vs. Fidus Investment Corp | Carlyle Secured vs. New Mountain Finance |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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