Correlation Between BlackRock TCP and XAI Octagon
Can any of the company-specific risk be diversified away by investing in both BlackRock TCP and XAI Octagon 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 BlackRock TCP and XAI Octagon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock TCP Capital and XAI Octagon Floating, you can compare the effects of market volatilities on BlackRock TCP and XAI Octagon 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 BlackRock TCP with a short position of XAI Octagon. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock TCP and XAI Octagon.
Diversification Opportunities for BlackRock TCP and XAI Octagon
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between BlackRock and XAI is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock TCP Capital and XAI Octagon Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XAI Octagon Floating and BlackRock TCP 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 BlackRock TCP Capital are associated (or correlated) with XAI Octagon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XAI Octagon Floating has no effect on the direction of BlackRock TCP i.e., BlackRock TCP and XAI Octagon go up and down completely randomly.
Pair Corralation between BlackRock TCP and XAI Octagon
Given the investment horizon of 90 days BlackRock TCP Capital is expected to generate 1.81 times more return on investment than XAI Octagon. However, BlackRock TCP is 1.81 times more volatile than XAI Octagon Floating. It trades about 0.15 of its potential returns per unit of risk. XAI Octagon Floating is currently generating about -0.03 per unit of risk. If you would invest 871.00 in BlackRock TCP Capital on November 1, 2024 and sell it today you would earn a total of 47.00 from holding BlackRock TCP Capital or generate 5.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock TCP Capital vs. XAI Octagon Floating
Performance |
| Timeline |
| BlackRock TCP Capital |
| XAI Octagon Floating |
BlackRock TCP and XAI Octagon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock TCP and XAI Octagon
The main advantage of trading using opposite BlackRock TCP and XAI Octagon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock TCP position performs unexpectedly, XAI Octagon 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 XAI Octagon will offset losses from the drop in XAI Octagon's long position.| BlackRock TCP vs. Triplepoint Venture Growth | BlackRock TCP vs. Sixth Street Specialty | BlackRock TCP vs. Golub Capital BDC | BlackRock TCP vs. New Mountain Finance |
| XAI Octagon vs. Oxford Lane Capital | XAI Octagon vs. Capital Southwest | XAI Octagon vs. Cornerstone Strategic Return | XAI Octagon vs. Cornerstone Strategic Value |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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