Correlation Between SLR Investment and Stellus Capital
Can any of the company-specific risk be diversified away by investing in both SLR Investment and Stellus Capital 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 Stellus Capital 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 Stellus Capital Investment, you can compare the effects of market volatilities on SLR Investment and Stellus Capital 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 Stellus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of SLR Investment and Stellus Capital.
Diversification Opportunities for SLR Investment and Stellus Capital
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SLR and Stellus is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding SLR Investment Corp and Stellus Capital Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stellus Capital Inve 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 Stellus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stellus Capital Inve has no effect on the direction of SLR Investment i.e., SLR Investment and Stellus Capital go up and down completely randomly.
Pair Corralation between SLR Investment and Stellus Capital
Given the investment horizon of 90 days SLR Investment is expected to generate 9.53 times less return on investment than Stellus Capital. But when comparing it to its historical volatility, SLR Investment Corp is 1.12 times less risky than Stellus Capital. It trades about 0.02 of its potential returns per unit of risk. Stellus Capital Investment is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,315 in Stellus Capital Investment on May 25, 2025 and sell it today you would earn a total of 136.00 from holding Stellus Capital Investment or generate 10.34% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SLR Investment Corp vs. Stellus Capital Investment
Performance |
Timeline |
SLR Investment Corp |
Stellus Capital Inve |
SLR Investment and Stellus Capital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SLR Investment and Stellus Capital
The main advantage of trading using opposite SLR Investment and Stellus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SLR Investment position performs unexpectedly, Stellus Capital 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 Stellus Capital will offset losses from the drop in Stellus Capital's long position.SLR Investment vs. Stellus Capital Investment | SLR Investment vs. Triplepoint Venture Growth | SLR Investment vs. Golub Capital BDC | SLR Investment vs. Gladstone Capital |
Stellus Capital vs. PennantPark Floating Rate | Stellus Capital vs. Gladstone Capital | Stellus Capital vs. Gladstone Investment | Stellus Capital vs. Prospect Capital |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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