Correlation Between Azure Holding and Oakworth Capital

Can any of the company-specific risk be diversified away by investing in both Azure Holding and Oakworth 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 Azure Holding and Oakworth Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Azure Holding Group and Oakworth Capital, you can compare the effects of market volatilities on Azure Holding and Oakworth 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 Azure Holding with a short position of Oakworth Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azure Holding and Oakworth Capital.

Diversification Opportunities for Azure Holding and Oakworth Capital

-0.24

Correlation Coefficient

Azure Holding  Oakworth Capital

Very good diversification

The 3 months correlation between Azure and Oakworth is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Azure Holding Group and Oakworth Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakworth Capital and Azure Holding 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 Azure Holding Group are associated (or correlated) with Oakworth Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakworth Capital has no effect on the direction of Azure Holding i.e., Azure Holding and Oakworth Capital go up and down completely randomly.

Pair Corralation between Azure Holding and Oakworth Capital

Given the investment horizon of 90 days Azure Holding Group is expected to generate 21.02 times more return on investment than Oakworth Capital. However, Azure Holding is 21.02 times more volatile than Oakworth Capital. It trades about 0.11 of its potential returns per unit of risk. Oakworth Capital is currently generating about 0.04 per unit of risk. If you would invest  12.00  in Azure Holding Group on December 20, 2024 and sell it today you would earn a total of  5.00  from holding Azure Holding Group or generate 41.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	92.19%
Values	Daily Returns

Azure Holding Group  vs.  Oakworth Capital

Azure Holding Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Azure Holding Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Azure Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Oakworth Capital

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Oakworth Capital are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound forward-looking signals, Oakworth Capital is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Azure Holding and Oakworth Capital

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

The idea behind Azure Holding Group and Oakworth Capital 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 Stocks Directory module to find actively traded stocks across global markets.