Correlation Between Holbrook Structured and Oshaughnessy Market

Can any of the company-specific risk be diversified away by investing in both Holbrook Structured and Oshaughnessy Market 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 Holbrook Structured and Oshaughnessy Market into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Holbrook Structured Income and Oshaughnessy Market Leaders, you can compare the effects of market volatilities on Holbrook Structured and Oshaughnessy Market 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 Holbrook Structured with a short position of Oshaughnessy Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holbrook Structured and Oshaughnessy Market.

Diversification Opportunities for Holbrook Structured and Oshaughnessy Market

0.69

Correlation Coefficient

Holbrook Structured  Oshaughnessy Market

Poor diversification

The 3 months correlation between Holbrook and Oshaughnessy is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Holbrook Structured Income and Oshaughnessy Market Leaders in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oshaughnessy Market and Holbrook Structured 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 Holbrook Structured Income are associated (or correlated) with Oshaughnessy Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oshaughnessy Market has no effect on the direction of Holbrook Structured i.e., Holbrook Structured and Oshaughnessy Market go up and down completely randomly.

Pair Corralation between Holbrook Structured and Oshaughnessy Market

Assuming the 90 days horizon Holbrook Structured Income is expected to generate 0.28 times more return on investment than Oshaughnessy Market. However, Holbrook Structured Income is 3.54 times less risky than Oshaughnessy Market. It trades about 0.26 of its potential returns per unit of risk. Oshaughnessy Market Leaders is currently generating about -0.17 per unit of risk. If you would invest  971.00  in Holbrook Structured Income on February 5, 2024 and sell it today you would earn a total of  11.00  from holding Holbrook Structured Income or generate 1.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Holbrook Structured Income  vs.  Oshaughnessy Market Leaders

Holbrook Structured

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Holbrook Structured Income are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Holbrook Structured is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Oshaughnessy Market

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Oshaughnessy Market Leaders are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Oshaughnessy Market may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Pair Trading with Holbrook Structured and Oshaughnessy Market

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

The idea behind Holbrook Structured Income and Oshaughnessy Market Leaders 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.