Correlation Between FS Credit and Cion Investment

Can any of the company-specific risk be diversified away by investing in both FS Credit and Cion 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 FS Credit and Cion Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FS Credit Opportunities and Cion Investment Corp, you can compare the effects of market volatilities on FS Credit and Cion 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 FS Credit with a short position of Cion Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of FS Credit and Cion Investment.

Diversification Opportunities for FS Credit and Cion Investment

0.56

Correlation Coefficient

FS Credit  Cion Investment

Very weak diversification

The 3 months correlation between FSCO and Cion is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding FS Credit Opportunities and Cion Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cion Investment Corp and FS Credit 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 FS Credit Opportunities are associated (or correlated) with Cion Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cion Investment Corp has no effect on the direction of FS Credit i.e., FS Credit and Cion Investment go up and down completely randomly.

Pair Corralation between FS Credit and Cion Investment

Given the investment horizon of 90 days FS Credit Opportunities is expected to generate 0.73 times more return on investment than Cion Investment. However, FS Credit Opportunities is 1.38 times less risky than Cion Investment. It trades about 0.18 of its potential returns per unit of risk. Cion Investment Corp is currently generating about 0.03 per unit of risk. If you would invest  681.00  in FS Credit Opportunities on May 4, 2025 and sell it today you would earn a total of  64.00  from holding FS Credit Opportunities or generate 9.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

FS Credit Opportunities  vs.  Cion Investment Corp

FS Credit Opportunities

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FS Credit Opportunities are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, FS Credit may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Cion Investment Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cion Investment Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Cion Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with FS Credit and Cion Investment

The main advantage of trading using opposite FS Credit and Cion Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FS Credit position performs unexpectedly, Cion 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 Cion Investment will offset losses from the drop in Cion Investment's long position.

The idea behind FS Credit Opportunities and Cion Investment Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.