Correlation Between Monks Investment and Crescent Capital
Can any of the company-specific risk be diversified away by investing in both Monks Investment and Crescent 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 Monks Investment and Crescent Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monks Investment Trust and Crescent Capital BDC, you can compare the effects of market volatilities on Monks Investment and Crescent 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 Monks Investment with a short position of Crescent Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monks Investment and Crescent Capital.
Diversification Opportunities for Monks Investment and Crescent Capital
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Monks and Crescent is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Monks Investment Trust and Crescent Capital BDC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crescent Capital BDC and Monks 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 Monks Investment Trust are associated (or correlated) with Crescent Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crescent Capital BDC has no effect on the direction of Monks Investment i.e., Monks Investment and Crescent Capital go up and down completely randomly.
Pair Corralation between Monks Investment and Crescent Capital
Assuming the 90 days trading horizon Monks Investment Trust is expected to generate 0.55 times more return on investment than Crescent Capital. However, Monks Investment Trust is 1.81 times less risky than Crescent Capital. It trades about 0.11 of its potential returns per unit of risk. Crescent Capital BDC is currently generating about -0.08 per unit of risk. If you would invest 139,000 in Monks Investment Trust on August 19, 2025 and sell it today you would earn a total of 7,200 from holding Monks Investment Trust or generate 5.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monks Investment Trust vs. Crescent Capital BDC
Performance |
| Timeline |
| Monks Investment Trust |
| Crescent Capital BDC |
Monks Investment and Crescent Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monks Investment and Crescent Capital
The main advantage of trading using opposite Monks Investment and Crescent Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monks Investment position performs unexpectedly, Crescent 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 Crescent Capital will offset losses from the drop in Crescent Capital's long position.| Monks Investment vs. Uniper SE | Monks Investment vs. London Security Plc | Monks Investment vs. Amicorp FS PLC | Monks Investment vs. Christian Dior SE |
| Crescent Capital vs. Gladstone Investment | Crescent Capital vs. Eagle Point Credit | Crescent Capital vs. MSCome Fund, | Crescent Capital vs. PennantPark 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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