Correlation Between Invesco Exchange and Live Oak
Can any of the company-specific risk be diversified away by investing in both Invesco Exchange and Live Oak 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 Invesco Exchange and Live Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Exchange and Live Oak Health, you can compare the effects of market volatilities on Invesco Exchange and Live Oak 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 Invesco Exchange with a short position of Live Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Exchange and Live Oak.
Diversification Opportunities for Invesco Exchange and Live Oak
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Invesco and Live is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Exchange and Live Oak Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Oak Health and Invesco Exchange 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 Invesco Exchange are associated (or correlated) with Live Oak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Oak Health has no effect on the direction of Invesco Exchange i.e., Invesco Exchange and Live Oak go up and down completely randomly.
Pair Corralation between Invesco Exchange and Live Oak
Assuming the 90 days horizon Invesco Exchange is expected to under-perform the Live Oak. In addition to that, Invesco Exchange is 7.3 times more volatile than Live Oak Health. It trades about -0.05 of its total potential returns per unit of risk. Live Oak Health is currently generating about 0.01 per unit of volatility. If you would invest 2,099 in Live Oak Health on September 12, 2024 and sell it today you would earn a total of 58.00 from holding Live Oak Health or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Exchange vs. Live Oak Health
Performance |
| Timeline |
| Invesco Exchange |
| Live Oak Health |
Invesco Exchange and Live Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Exchange and Live Oak
The main advantage of trading using opposite Invesco Exchange and Live Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Exchange position performs unexpectedly, Live Oak 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 Live Oak will offset losses from the drop in Live Oak's long position.| Invesco Exchange vs. Live Oak Health | Invesco Exchange vs. Delaware Healthcare Fund | Invesco Exchange vs. Tekla Healthcare Opportunities | Invesco Exchange vs. Alger Health Sciences |
| Live Oak vs. Black Oak Emerging | Live Oak vs. Pin Oak Equity | Live Oak vs. Red Oak Technology | Live Oak vs. White Oak Select |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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