Correlation Between Needham Growth and Oshidori International

Can any of the company-specific risk be diversified away by investing in both Needham Growth and Oshidori International 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 Needham Growth and Oshidori International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Needham Growth Fund and Oshidori International Holdings, you can compare the effects of market volatilities on Needham Growth and Oshidori International 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 Needham Growth with a short position of Oshidori International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Growth and Oshidori International.

Diversification Opportunities for Needham Growth and Oshidori International

-0.71

Correlation Coefficient

Needham Growth  Oshidori International

Pay attention - limited upside

The 3 months correlation between Needham and Oshidori is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Needham Growth Fund and Oshidori International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oshidori International and Needham Growth 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 Needham Growth Fund are associated (or correlated) with Oshidori International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oshidori International has no effect on the direction of Needham Growth i.e., Needham Growth and Oshidori International go up and down completely randomly.

Pair Corralation between Needham Growth and Oshidori International

If you would invest  5,975  in Needham Growth Fund on September 19, 2024 and sell it today you would earn a total of  421.00  from holding Needham Growth Fund or generate 7.05% return on investment over 90 days.

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

Needham Growth Fund  vs.  Oshidori International Holding

Needham Growth

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Needham Growth Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Needham Growth is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Oshidori International

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Oshidori International Holdings are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating fundamental indicators, Oshidori International reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Needham Growth and Oshidori International

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

The idea behind Needham Growth Fund and Oshidori International Holdings 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.