Correlation Between Oxford Lane and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Oxford Lane and Eaton Vance 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 Eaton Vance 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 Eaton Vance Tax Managed, you can compare the effects of market volatilities on Oxford Lane and Eaton Vance 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 Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxford Lane and Eaton Vance.
Diversification Opportunities for Oxford Lane and Eaton Vance
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Oxford and Eaton is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Lane Capital and Eaton Vance Tax Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Tax 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 Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Tax has no effect on the direction of Oxford Lane i.e., Oxford Lane and Eaton Vance go up and down completely randomly.
Pair Corralation between Oxford Lane and Eaton Vance
Given the investment horizon of 90 days Oxford Lane Capital is expected to generate 1.26 times more return on investment than Eaton Vance. However, Oxford Lane is 1.26 times more volatile than Eaton Vance Tax Managed. It trades about 0.08 of its potential returns per unit of risk. Eaton Vance Tax Managed is currently generating about 0.09 per unit of risk. If you would invest 403.00 in Oxford Lane Capital on September 12, 2024 and sell it today you would earn a total of 121.50 from holding Oxford Lane Capital or generate 30.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.7% |
| Values | Daily Returns |
Oxford Lane Capital vs. Eaton Vance Tax Managed
Performance |
| Timeline |
| Oxford Lane Capital |
| Eaton Vance Tax |
Oxford Lane and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxford Lane and Eaton Vance
The main advantage of trading using opposite Oxford Lane and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxford Lane position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance'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 |
| Eaton Vance vs. Oxford Lane Capital | Eaton Vance vs. Orchid Island Capital | Eaton Vance vs. Guggenheim Strategic Opportunities | Eaton Vance vs. Stone Harbor Emerging |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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