Correlation Between SLR Investment and ALTER NRG
Can any of the company-specific risk be diversified away by investing in both SLR Investment and ALTER NRG 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 ALTER NRG 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 ALTER NRG, you can compare the effects of market volatilities on SLR Investment and ALTER NRG 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 ALTER NRG. Check out your portfolio center. Please also check ongoing floating volatility patterns of SLR Investment and ALTER NRG.
Diversification Opportunities for SLR Investment and ALTER NRG
-0.94 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SLR and ALTER is -0.94. Overlapping area represents the amount of risk that can be diversified away by holding SLR Investment Corp and ALTER NRG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALTER NRG 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 ALTER NRG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALTER NRG has no effect on the direction of SLR Investment i.e., SLR Investment and ALTER NRG go up and down completely randomly.
Pair Corralation between SLR Investment and ALTER NRG
Assuming the 90 days horizon SLR Investment Corp is expected to generate 0.45 times more return on investment than ALTER NRG. However, SLR Investment Corp is 2.24 times less risky than ALTER NRG. It trades about 0.07 of its potential returns per unit of risk. ALTER NRG is currently generating about 0.0 per unit of risk. If you would invest 1,067 in SLR Investment Corp on September 14, 2024 and sell it today you would earn a total of 527.00 from holding SLR Investment Corp or generate 49.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SLR Investment Corp vs. ALTER NRG
Performance |
| Timeline |
| SLR Investment Corp |
| ALTER NRG |
SLR Investment and ALTER NRG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SLR Investment and ALTER NRG
The main advantage of trading using opposite SLR Investment and ALTER NRG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SLR Investment position performs unexpectedly, ALTER NRG 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 ALTER NRG will offset losses from the drop in ALTER NRG's long position.| SLR Investment vs. QBE Insurance Group | SLR Investment vs. Selective Insurance Group | SLR Investment vs. Summit Materials | SLR Investment vs. REVO INSURANCE SPA |
| ALTER NRG vs. ANTA SPORTS PRODUCT | ALTER NRG vs. Playa Hotels Resorts | ALTER NRG vs. HK Electric Investments | ALTER NRG vs. SLR Investment Corp |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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