Correlation Between XAI Octagon and Pcm Fund
Can any of the company-specific risk be diversified away by investing in both XAI Octagon and Pcm Fund 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 XAI Octagon and Pcm Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XAI Octagon Floating and Pcm Fund, you can compare the effects of market volatilities on XAI Octagon and Pcm Fund 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 XAI Octagon with a short position of Pcm Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of XAI Octagon and Pcm Fund.
Diversification Opportunities for XAI Octagon and Pcm Fund
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between XAI and Pcm is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding XAI Octagon Floating and Pcm Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pcm Fund and XAI Octagon 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 XAI Octagon Floating are associated (or correlated) with Pcm Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pcm Fund has no effect on the direction of XAI Octagon i.e., XAI Octagon and Pcm Fund go up and down completely randomly.
Pair Corralation between XAI Octagon and Pcm Fund
Given the investment horizon of 90 days XAI Octagon Floating is expected to generate 0.46 times more return on investment than Pcm Fund. However, XAI Octagon Floating is 2.18 times less risky than Pcm Fund. It trades about 0.12 of its potential returns per unit of risk. Pcm Fund is currently generating about -0.01 per unit of risk. If you would invest 650.00 in XAI Octagon Floating on September 3, 2024 and sell it today you would earn a total of 55.00 from holding XAI Octagon Floating or generate 8.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
XAI Octagon Floating vs. Pcm Fund
Performance |
| Timeline |
| XAI Octagon Floating |
| Pcm Fund |
XAI Octagon and Pcm Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XAI Octagon and Pcm Fund
The main advantage of trading using opposite XAI Octagon and Pcm Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XAI Octagon position performs unexpectedly, Pcm Fund 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 Pcm Fund will offset losses from the drop in Pcm Fund's long position.| XAI Octagon vs. Oxford Lane Capital | XAI Octagon vs. Capital Southwest | XAI Octagon vs. Cornerstone Strategic Return | XAI Octagon vs. Cornerstone Strategic Value |
| Pcm Fund vs. Tekla Healthcare Investors | Pcm Fund vs. Tekla Life Sciences | Pcm Fund vs. Cohen Steers Reit | Pcm Fund vs. XAI Octagon Floating |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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