Correlation Between Ophmr Eml and Oppenheimer Intl

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

By analyzing existing cross correlation between Ophmr Eml Dbt and Oppenheimer Intl Grwth, you can compare the effects of market volatilities on Ophmr Eml and Oppenheimer Intl 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 Ophmr Eml with a short position of Oppenheimer Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ophmr Eml and Oppenheimer Intl.

Diversification Opportunities for Ophmr Eml and Oppenheimer Intl

0.9

Correlation Coefficient

Ophmr Eml  Oppenheimer Intl

Almost no diversification

The 3 months correlation between Ophmr and Oppenheimer is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Ophmr Eml Dbt and Oppenheimer Intl Grwth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Intl Grwth and Ophmr Eml 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 Ophmr Eml Dbt are associated (or correlated) with Oppenheimer Intl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Intl Grwth has no effect on the direction of Ophmr Eml i.e., Ophmr Eml and Oppenheimer Intl go up and down completely randomly.

Pair Corralation between Ophmr Eml and Oppenheimer Intl

Assuming the 90 days horizon Ophmr Eml Dbt is expected to generate 0.3 times more return on investment than Oppenheimer Intl. However, Ophmr Eml Dbt is 3.39 times less risky than Oppenheimer Intl. It trades about -0.04 of its potential returns per unit of risk. Oppenheimer Intl Grwth is currently generating about -0.12 per unit of risk. If you would invest  520.00  in Ophmr Eml Dbt on October 24, 2024 and sell it today you would lose (6.00) from holding Ophmr Eml Dbt or give up 1.15% of portfolio value over 90 days.

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

Ophmr Eml Dbt  vs.  Oppenheimer Intl Grwth

Ophmr Eml Dbt

Risk-Adjusted Performance

0 of 100

Very Weak

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

Oppenheimer Intl Grwth

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Ophmr Eml and Oppenheimer Intl

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

The idea behind Ophmr Eml Dbt and Oppenheimer Intl Grwth 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.