Correlation Between The Gold and Natixis Oakmark
Can any of the company-specific risk be diversified away by investing in both The Gold and Natixis Oakmark 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 The Gold and Natixis Oakmark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Gold Bullion and Natixis Oakmark, you can compare the effects of market volatilities on The Gold and Natixis Oakmark 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 The Gold with a short position of Natixis Oakmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Gold and Natixis Oakmark.
Diversification Opportunities for The Gold and Natixis Oakmark
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between The and Natixis is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding The Gold Bullion and Natixis Oakmark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis Oakmark and The Gold 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 The Gold Bullion are associated (or correlated) with Natixis Oakmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis Oakmark has no effect on the direction of The Gold i.e., The Gold and Natixis Oakmark go up and down completely randomly.
Pair Corralation between The Gold and Natixis Oakmark
Assuming the 90 days horizon The Gold Bullion is expected to generate 0.96 times more return on investment than Natixis Oakmark. However, The Gold Bullion is 1.04 times less risky than Natixis Oakmark. It trades about 0.0 of its potential returns per unit of risk. Natixis Oakmark is currently generating about 0.0 per unit of risk. If you would invest 2,071 in The Gold Bullion on October 21, 2024 and sell it today you would lose (1.00) from holding The Gold Bullion or give up 0.05% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
The Gold Bullion vs. Natixis Oakmark
Performance |
Timeline |
Gold Bullion |
Natixis Oakmark |
The Gold and Natixis Oakmark Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with The Gold and Natixis Oakmark
The main advantage of trading using opposite The Gold and Natixis Oakmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Gold position performs unexpectedly, Natixis Oakmark 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 Natixis Oakmark will offset losses from the drop in Natixis Oakmark's long position.The Gold vs. Tax Managed Large Cap | ||
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Check out your portfolio center.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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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