Correlation Between SuRo Capital and Brightsphere Investment
Can any of the company-specific risk be diversified away by investing in both SuRo Capital and Brightsphere Investment 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 SuRo Capital and Brightsphere Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SuRo Capital Corp and Brightsphere Investment Group, you can compare the effects of market volatilities on SuRo Capital and Brightsphere Investment 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 SuRo Capital with a short position of Brightsphere Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of SuRo Capital and Brightsphere Investment.
Diversification Opportunities for SuRo Capital and Brightsphere Investment
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SuRo and Brightsphere is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding SuRo Capital Corp and Brightsphere Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brightsphere Investment and SuRo Capital 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 SuRo Capital Corp are associated (or correlated) with Brightsphere Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brightsphere Investment has no effect on the direction of SuRo Capital i.e., SuRo Capital and Brightsphere Investment go up and down completely randomly.
Pair Corralation between SuRo Capital and Brightsphere Investment
Given the investment horizon of 90 days SuRo Capital is expected to generate 1.49 times less return on investment than Brightsphere Investment. In addition to that, SuRo Capital is 1.91 times more volatile than Brightsphere Investment Group. It trades about 0.15 of its total potential returns per unit of risk. Brightsphere Investment Group is currently generating about 0.43 per unit of volatility. If you would invest 2,639 in Brightsphere Investment Group on September 1, 2024 and sell it today you would earn a total of 479.00 from holding Brightsphere Investment Group or generate 18.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SuRo Capital Corp vs. Brightsphere Investment Group
Performance |
| Timeline |
| SuRo Capital Corp |
| Brightsphere Investment |
SuRo Capital and Brightsphere Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SuRo Capital and Brightsphere Investment
The main advantage of trading using opposite SuRo Capital and Brightsphere Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SuRo Capital position performs unexpectedly, Brightsphere Investment 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 Brightsphere Investment will offset losses from the drop in Brightsphere Investment's long position.| SuRo Capital vs. Brightsphere Investment Group | SuRo Capital vs. Blackrock Muniholdings Ca | SuRo Capital vs. Putnam Managed Municipal | SuRo Capital vs. Investcorp Credit Management |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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