Correlation Between Oxford Lane and DTF Tax
Can any of the company-specific risk be diversified away by investing in both Oxford Lane and DTF Tax 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 DTF Tax 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 DTF Tax Free, you can compare the effects of market volatilities on Oxford Lane and DTF Tax 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 DTF Tax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxford Lane and DTF Tax.
Diversification Opportunities for Oxford Lane and DTF Tax
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Oxford and DTF is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Lane Capital and DTF Tax Free in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DTF Tax Free 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 DTF Tax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DTF Tax Free has no effect on the direction of Oxford Lane i.e., Oxford Lane and DTF Tax go up and down completely randomly.
Pair Corralation between Oxford Lane and DTF Tax
Assuming the 90 days horizon Oxford Lane Capital is expected to generate 1.45 times more return on investment than DTF Tax. However, Oxford Lane is 1.45 times more volatile than DTF Tax Free. It trades about 0.07 of its potential returns per unit of risk. DTF Tax Free is currently generating about 0.06 per unit of risk. If you would invest 1,933 in Oxford Lane Capital on August 31, 2024 and sell it today you would earn a total of 365.00 from holding Oxford Lane Capital or generate 18.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.39% |
| Values | Daily Returns |
Oxford Lane Capital vs. DTF Tax Free
Performance |
| Timeline |
| Oxford Lane Capital |
| DTF Tax Free |
Oxford Lane and DTF Tax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxford Lane and DTF Tax
The main advantage of trading using opposite Oxford Lane and DTF Tax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxford Lane position performs unexpectedly, DTF Tax 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 DTF Tax will offset losses from the drop in DTF Tax's long position.| Oxford Lane vs. Oxford Lane Capital | Oxford Lane vs. Oxford Lane Capital | Oxford Lane vs. The Gabelli Multimedia | Oxford Lane vs. The Gabelli Equity |
| DTF Tax vs. MFS Investment Grade | DTF Tax vs. Eaton Vance National | DTF Tax vs. Invesco High Income | DTF Tax vs. MFS High Yield |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |