Correlation Between Old Westbury and Oppenheimer Glabal

Can any of the company-specific risk be diversified away by investing in both Old Westbury and Oppenheimer Glabal 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 Old Westbury and Oppenheimer Glabal into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Old Westbury Large and Oppenheimer Glabal A, you can compare the effects of market volatilities on Old Westbury and Oppenheimer Glabal 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 Old Westbury with a short position of Oppenheimer Glabal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Oppenheimer Glabal.

Diversification Opportunities for Old Westbury and Oppenheimer Glabal

0.97

Correlation Coefficient

Old Westbury  Oppenheimer Glabal

Almost no diversification

The 3 months correlation between Old and Oppenheimer is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Large and Oppenheimer Glabal A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Glabal and Old Westbury 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 Old Westbury Large are associated (or correlated) with Oppenheimer Glabal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Glabal has no effect on the direction of Old Westbury i.e., Old Westbury and Oppenheimer Glabal go up and down completely randomly.

Pair Corralation between Old Westbury and Oppenheimer Glabal

Assuming the 90 days horizon Old Westbury Large is expected to generate 0.85 times more return on investment than Oppenheimer Glabal. However, Old Westbury Large is 1.18 times less risky than Oppenheimer Glabal. It trades about -0.02 of its potential returns per unit of risk. Oppenheimer Glabal A is currently generating about -0.07 per unit of risk. If you would invest  1,846  in Old Westbury Large on January 24, 2024 and sell it today you would lose (14.00) from holding Old Westbury Large or give up 0.76% of portfolio value over 90 days.

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

Old Westbury Large  vs.  Oppenheimer Glabal A

Old Westbury Large

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Old Westbury Large are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Old Westbury is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Oppenheimer Glabal

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Oppenheimer Glabal A are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Oppenheimer Glabal is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Old Westbury and Oppenheimer Glabal

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

The idea behind Old Westbury Large and Oppenheimer Glabal A 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.