Correlation Between Oxford Lane and OFS Credit
Can any of the company-specific risk be diversified away by investing in both Oxford Lane and OFS Credit 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 OFS Credit 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 OFS Credit, you can compare the effects of market volatilities on Oxford Lane and OFS Credit 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 OFS Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxford Lane and OFS Credit.
Diversification Opportunities for Oxford Lane and OFS Credit
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oxford and OFS is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Lane Capital and OFS Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFS Credit 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 OFS Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFS Credit has no effect on the direction of Oxford Lane i.e., Oxford Lane and OFS Credit go up and down completely randomly.
Pair Corralation between Oxford Lane and OFS Credit
Assuming the 90 days horizon Oxford Lane is expected to generate 1.06 times less return on investment than OFS Credit. But when comparing it to its historical volatility, Oxford Lane Capital is 1.46 times less risky than OFS Credit. It trades about 0.22 of its potential returns per unit of risk. OFS Credit is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 2,369 in OFS Credit on November 2, 2024 and sell it today you would earn a total of 24.00 from holding OFS Credit or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oxford Lane Capital vs. OFS Credit
Performance |
| Timeline |
| Oxford Lane Capital |
| OFS Credit |
Oxford Lane and OFS Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxford Lane and OFS Credit
The main advantage of trading using opposite Oxford Lane and OFS Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxford Lane position performs unexpectedly, OFS Credit 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 OFS Credit will offset losses from the drop in OFS Credit'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 |
| OFS Credit vs. OFS Credit | OFS Credit vs. Oxford Lane Capital | OFS Credit vs. Gladstone Land Corp | OFS Credit vs. Eagle Point Income |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |