Correlation Between Oxford Lane and Fortress Biotech
Can any of the company-specific risk be diversified away by investing in both Oxford Lane and Fortress Biotech 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 Fortress Biotech 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 Fortress Biotech Pref, you can compare the effects of market volatilities on Oxford Lane and Fortress Biotech 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 Fortress Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxford Lane and Fortress Biotech.
Diversification Opportunities for Oxford Lane and Fortress Biotech
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Oxford and Fortress is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Lane Capital and Fortress Biotech Pref in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortress Biotech Pref 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 Fortress Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortress Biotech Pref has no effect on the direction of Oxford Lane i.e., Oxford Lane and Fortress Biotech go up and down completely randomly.
Pair Corralation between Oxford Lane and Fortress Biotech
Assuming the 90 days horizon Oxford Lane Capital is expected to generate 0.07 times more return on investment than Fortress Biotech. However, Oxford Lane Capital is 13.84 times less risky than Fortress Biotech. It trades about 0.13 of its potential returns per unit of risk. Fortress Biotech Pref is currently generating about -0.03 per unit of risk. If you would invest 2,160 in Oxford Lane Capital on August 24, 2024 and sell it today you would earn a total of 248.00 from holding Oxford Lane Capital or generate 11.48% 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. Fortress Biotech Pref
Performance |
| Timeline |
| Oxford Lane Capital |
| Fortress Biotech Pref |
Oxford Lane and Fortress Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxford Lane and Fortress Biotech
The main advantage of trading using opposite Oxford Lane and Fortress Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxford Lane position performs unexpectedly, Fortress Biotech 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 Fortress Biotech will offset losses from the drop in Fortress Biotech's long position.| Oxford Lane vs. Oxford Lane Capital | Oxford Lane vs. Gladstone Commercial Corp | Oxford Lane vs. New York Mortgage | Oxford Lane vs. New York Mortgage |
| Fortress Biotech vs. Checkpoint Therapeutics | Fortress Biotech vs. Mustang Bio | Fortress Biotech vs. Reviva Pharmaceuticals Holdings | Fortress Biotech vs. Kodiak Sciences |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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