Correlation Between Brown Advisory and Oppenheimer Gold

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

By analyzing existing cross correlation between Brown Advisory Mid Cap and Oppenheimer Gold Special, you can compare the effects of market volatilities on Brown Advisory and Oppenheimer Gold 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 Brown Advisory with a short position of Oppenheimer Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brown Advisory and Oppenheimer Gold.

Diversification Opportunities for Brown Advisory and Oppenheimer Gold

-0.24

Correlation Coefficient

Brown Advisory  Oppenheimer Gold

Very good diversification

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

Pair Corralation between Brown Advisory and Oppenheimer Gold

Assuming the 90 days horizon Brown Advisory Mid Cap is expected to under-perform the Oppenheimer Gold. But the mutual fund apears to be less risky and, when comparing its historical volatility, Brown Advisory Mid Cap is 1.27 times less risky than Oppenheimer Gold. The mutual fund trades about -0.1 of its potential returns per unit of risk. The Oppenheimer Gold Special is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  2,263  in Oppenheimer Gold Special on December 30, 2024 and sell it today you would earn a total of  622.00  from holding Oppenheimer Gold Special or generate 27.49% return on investment over 90 days.

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

Brown Advisory Mid Cap  vs.  Oppenheimer Gold Special

Brown Advisory Mid

Risk-Adjusted Performance

Very Weak

Over the last 90 days Brown Advisory Mid Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Oppenheimer Gold Special

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Oppenheimer Gold Special are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly unfluctuating fundamental indicators, Oppenheimer Gold showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Brown Advisory and Oppenheimer Gold

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

The idea behind Brown Advisory Mid Cap and Oppenheimer Gold Special 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..