Correlation Between SLR Investment and Ameritrans Capital
Can any of the company-specific risk be diversified away by investing in both SLR Investment and Ameritrans Capital 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 SLR Investment and Ameritrans Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SLR Investment Corp and Ameritrans Capital Corp, you can compare the effects of market volatilities on SLR Investment and Ameritrans Capital 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 SLR Investment with a short position of Ameritrans Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of SLR Investment and Ameritrans Capital.
Diversification Opportunities for SLR Investment and Ameritrans Capital
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SLR and Ameritrans is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding SLR Investment Corp and Ameritrans Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameritrans Capital Corp and SLR Investment 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 SLR Investment Corp are associated (or correlated) with Ameritrans Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameritrans Capital Corp has no effect on the direction of SLR Investment i.e., SLR Investment and Ameritrans Capital go up and down completely randomly.
Pair Corralation between SLR Investment and Ameritrans Capital
Given the investment horizon of 90 days SLR Investment Corp is expected to generate 0.24 times more return on investment than Ameritrans Capital. However, SLR Investment Corp is 4.19 times less risky than Ameritrans Capital. It trades about 0.07 of its potential returns per unit of risk. Ameritrans Capital Corp is currently generating about -0.04 per unit of risk. If you would invest 1,233 in SLR Investment Corp on November 2, 2024 and sell it today you would earn a total of 451.00 from holding SLR Investment Corp or generate 36.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.4% |
| Values | Daily Returns |
SLR Investment Corp vs. Ameritrans Capital Corp
Performance |
| Timeline |
| SLR Investment Corp |
| Ameritrans Capital Corp |
SLR Investment and Ameritrans Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SLR Investment and Ameritrans Capital
The main advantage of trading using opposite SLR Investment and Ameritrans Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SLR Investment position performs unexpectedly, Ameritrans Capital 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 Ameritrans Capital will offset losses from the drop in Ameritrans Capital's long position.| SLR Investment vs. Horizon Technology Finance | SLR Investment vs. WhiteHorse Finance | SLR Investment vs. Gladstone Capital | SLR Investment vs. PennantPark Floating Rate |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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