Correlation Between Wanger International and Oppenheimer Gold

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

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

Diversification Opportunities for Wanger International and Oppenheimer Gold

0.62

Correlation Coefficient

Wanger International  Oppenheimer Gold

Poor diversification

The 3 months correlation between Wanger and Oppenheimer is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Wanger International Wanger 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 Wanger International 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 Wanger International Wanger 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 Wanger International i.e., Wanger International and Oppenheimer Gold go up and down completely randomly.

Pair Corralation between Wanger International and Oppenheimer Gold

Assuming the 90 days horizon Wanger International is expected to generate 2.05 times less return on investment than Oppenheimer Gold. But when comparing it to its historical volatility, Wanger International Wanger is 1.79 times less risky than Oppenheimer Gold. It trades about 0.02 of its potential returns per unit of risk. Oppenheimer Gold Special is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  2,054  in Oppenheimer Gold Special on September 26, 2024 and sell it today you would earn a total of  253.00  from holding Oppenheimer Gold Special or generate 12.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.8%
Values	Daily Returns

Wanger International Wanger  vs.  Oppenheimer Gold Special

Wanger International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wanger International Wanger has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Oppenheimer Gold Special

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oppenheimer Gold Special has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Wanger International and Oppenheimer Gold

The main advantage of trading using opposite Wanger International and Oppenheimer Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wanger International 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 Wanger International Wanger 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.