Correlation Between Oberweis Emerging and Tiaa-cref Small-cap

Can any of the company-specific risk be diversified away by investing in both Oberweis Emerging and Tiaa-cref Small-cap 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 Oberweis Emerging and Tiaa-cref Small-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Oberweis Emerging Growth and Tiaa Cref Small Cap Blend, you can compare the effects of market volatilities on Oberweis Emerging and Tiaa-cref Small-cap 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 Oberweis Emerging with a short position of Tiaa-cref Small-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oberweis Emerging and Tiaa-cref Small-cap.

Diversification Opportunities for Oberweis Emerging and Tiaa-cref Small-cap

0.67

Correlation Coefficient

Oberweis Emerging  Tiaa-cref Small-cap

Poor diversification

The 3 months correlation between Oberweis and Tiaa-cref is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Oberweis Emerging Growth and Tiaa Cref Small Cap Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa-cref Small-cap and Oberweis Emerging 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 Oberweis Emerging Growth are associated (or correlated) with Tiaa-cref Small-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa-cref Small-cap has no effect on the direction of Oberweis Emerging i.e., Oberweis Emerging and Tiaa-cref Small-cap go up and down completely randomly.

Pair Corralation between Oberweis Emerging and Tiaa-cref Small-cap

Assuming the 90 days horizon Oberweis Emerging Growth is expected to generate 0.8 times more return on investment than Tiaa-cref Small-cap. However, Oberweis Emerging Growth is 1.26 times less risky than Tiaa-cref Small-cap. It trades about 0.0 of its potential returns per unit of risk. Tiaa Cref Small Cap Blend is currently generating about -0.03 per unit of risk. If you would invest  3,105  in Oberweis Emerging Growth on October 9, 2024 and sell it today you would lose (21.00) from holding Oberweis Emerging Growth or give up 0.68% of portfolio value over 90 days.

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

Oberweis Emerging Growth  vs.  Tiaa Cref Small Cap Blend

Oberweis Emerging Growth

Risk-Adjusted Performance

0 of 100

Very Weak

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

Tiaa-cref Small-cap

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tiaa Cref Small Cap Blend has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, Tiaa-cref Small-cap is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Oberweis Emerging and Tiaa-cref Small-cap

The main advantage of trading using opposite Oberweis Emerging and Tiaa-cref Small-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oberweis Emerging position performs unexpectedly, Tiaa-cref Small-cap 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 Tiaa-cref Small-cap will offset losses from the drop in Tiaa-cref Small-cap's long position.

The idea behind Oberweis Emerging Growth and Tiaa Cref Small Cap Blend 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.