Correlation Between Oxford Lane and BlackRock Health
Can any of the company-specific risk be diversified away by investing in both Oxford Lane and BlackRock Health 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 Oxford Lane and BlackRock Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oxford Lane Capital and BlackRock Health Sciences, you can compare the effects of market volatilities on Oxford Lane and BlackRock Health 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 Oxford Lane with a short position of BlackRock Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxford Lane and BlackRock Health.
Diversification Opportunities for Oxford Lane and BlackRock Health
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oxford and BlackRock is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Lane Capital and BlackRock Health Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlackRock Health Sciences and Oxford Lane 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 Oxford Lane Capital are associated (or correlated) with BlackRock Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlackRock Health Sciences has no effect on the direction of Oxford Lane i.e., Oxford Lane and BlackRock Health go up and down completely randomly.
Pair Corralation between Oxford Lane and BlackRock Health
Given the investment horizon of 90 days Oxford Lane Capital is expected to generate 0.69 times more return on investment than BlackRock Health. However, Oxford Lane Capital is 1.45 times less risky than BlackRock Health. It trades about 0.1 of its potential returns per unit of risk. BlackRock Health Sciences is currently generating about -0.14 per unit of risk. If you would invest 515.00 in Oxford Lane Capital on August 28, 2024 and sell it today you would earn a total of 7.00 from holding Oxford Lane Capital or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oxford Lane Capital vs. BlackRock Health Sciences
Performance |
| Timeline |
| Oxford Lane Capital |
| BlackRock Health Sciences |
Oxford Lane and BlackRock Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxford Lane and BlackRock Health
The main advantage of trading using opposite Oxford Lane and BlackRock Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxford Lane position performs unexpectedly, BlackRock Health 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 BlackRock Health will offset losses from the drop in BlackRock Health's long position.| Oxford Lane vs. Capital Southwest | Oxford Lane vs. XAI Octagon Floating | Oxford Lane vs. Cornerstone Strategic Return | Oxford Lane vs. Cornerstone Strategic Value |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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