Correlation Between Starfleet Innotech and Carlyle Secured

Can any of the company-specific risk be diversified away by investing in both Starfleet Innotech and Carlyle Secured 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 Starfleet Innotech and Carlyle Secured into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Starfleet Innotech and Carlyle Secured Lending, you can compare the effects of market volatilities on Starfleet Innotech and Carlyle Secured 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 Starfleet Innotech with a short position of Carlyle Secured. Check out your portfolio center. Please also check ongoing floating volatility patterns of Starfleet Innotech and Carlyle Secured.

Diversification Opportunities for Starfleet Innotech and Carlyle Secured

-0.01

Correlation Coefficient

Starfleet Innotech  Carlyle Secured

Good diversification

The 3 months correlation between Starfleet and Carlyle is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Starfleet Innotech and Carlyle Secured Lending in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlyle Secured Lending and Starfleet Innotech 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 Starfleet Innotech are associated (or correlated) with Carlyle Secured. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlyle Secured Lending has no effect on the direction of Starfleet Innotech i.e., Starfleet Innotech and Carlyle Secured go up and down completely randomly.

Pair Corralation between Starfleet Innotech and Carlyle Secured

Given the investment horizon of 90 days Starfleet Innotech is expected to generate 23.4 times more return on investment than Carlyle Secured. However, Starfleet Innotech is 23.4 times more volatile than Carlyle Secured Lending. It trades about 0.06 of its potential returns per unit of risk. Carlyle Secured Lending is currently generating about 0.29 per unit of risk. If you would invest  0.33  in Starfleet Innotech on September 28, 2024 and sell it today you would lose (0.03) from holding Starfleet Innotech or give up 9.09% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Starfleet Innotech  vs.  Carlyle Secured Lending

Starfleet Innotech

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Starfleet Innotech are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady forward indicators, Starfleet Innotech displayed solid returns over the last few months and may actually be approaching a breakup point.

Carlyle Secured Lending

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Carlyle Secured Lending are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental drivers, Carlyle Secured may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Starfleet Innotech and Carlyle Secured

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

The idea behind Starfleet Innotech and Carlyle Secured Lending 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.