Correlation Between American Funds and Oppenheimer Glabal
Can any of the company-specific risk be diversified away by investing in both American Funds 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 American Funds and Oppenheimer Glabal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Funds Global and Oppenheimer Glabal A, you can compare the effects of market volatilities on American Funds 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 American Funds with a short position of Oppenheimer Glabal. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Oppenheimer Glabal.
Diversification Opportunities for American Funds and Oppenheimer Glabal
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between American and Oppenheimer is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding American Funds Global and Oppenheimer Glabal A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Glabal and American Funds 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 American Funds Global 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 American Funds i.e., American Funds and Oppenheimer Glabal go up and down completely randomly.
Pair Corralation between American Funds and Oppenheimer Glabal
Assuming the 90 days horizon American Funds Global is expected to under-perform the Oppenheimer Glabal. But the mutual fund apears to be less risky and, when comparing its historical volatility, American Funds Global is 1.16 times less risky than Oppenheimer Glabal. The mutual fund trades about -0.16 of its potential returns per unit of risk. The Oppenheimer Glabal A is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 9,939 in Oppenheimer Glabal A on January 26, 2024 and sell it today you would lose (196.00) from holding Oppenheimer Glabal A or give up 1.97% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
American Funds Global vs. Oppenheimer Glabal A
Performance |
Timeline |
American Funds Global |
Oppenheimer Glabal |
American Funds and Oppenheimer Glabal Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with American Funds and Oppenheimer Glabal
The main advantage of trading using opposite American Funds and Oppenheimer Glabal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds 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.American Funds vs. Marsico 21st Century | American Funds vs. Northern Small Cap | American Funds vs. Aberdeen Select International | American Funds vs. HUMANA INC |
Oppenheimer Glabal vs. Marsico 21st Century | Oppenheimer Glabal vs. Northern Small Cap | Oppenheimer Glabal vs. Aberdeen Select International | Oppenheimer Glabal vs. HUMANA INC |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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