Correlation Between Close Brothers and Open Lending
Can any of the company-specific risk be diversified away by investing in both Close Brothers and Open Lending 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 Close Brothers and Open Lending into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Close Brothers Group and Open Lending Corp, you can compare the effects of market volatilities on Close Brothers and Open Lending 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 Close Brothers with a short position of Open Lending. Check out your portfolio center. Please also check ongoing floating volatility patterns of Close Brothers and Open Lending.
Diversification Opportunities for Close Brothers and Open Lending
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Close and Open is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Close Brothers Group and Open Lending Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Open Lending Corp and Close Brothers 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 Close Brothers Group are associated (or correlated) with Open Lending. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Open Lending Corp has no effect on the direction of Close Brothers i.e., Close Brothers and Open Lending go up and down completely randomly.
Pair Corralation between Close Brothers and Open Lending
Assuming the 90 days trading horizon Close Brothers Group is expected to generate 0.61 times more return on investment than Open Lending. However, Close Brothers Group is 1.64 times less risky than Open Lending. It trades about -0.11 of its potential returns per unit of risk. Open Lending Corp is currently generating about -0.12 per unit of risk. If you would invest 50,100 in Close Brothers Group on August 22, 2025 and sell it today you would lose (8,900) from holding Close Brothers Group or give up 17.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Close Brothers Group vs. Open Lending Corp
Performance |
| Timeline |
| Close Brothers Group |
| Open Lending Corp |
Close Brothers and Open Lending Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Close Brothers and Open Lending
The main advantage of trading using opposite Close Brothers and Open Lending positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Close Brothers position performs unexpectedly, Open Lending 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 Open Lending will offset losses from the drop in Open Lending's long position.| Close Brothers vs. Aptitude Software Group | Close Brothers vs. Fevertree Drinks Plc | Close Brothers vs. Impax Asset Management | Close Brothers vs. International Biotechnology Trust |
| Open Lending vs. Medallion Financial Corp | Open Lending vs. CPI Card Group | Open Lending vs. Finance of America | Open Lending vs. Yirendai |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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