Correlation Between ANZ Group and Oakridge International
Can any of the company-specific risk be diversified away by investing in both ANZ Group and Oakridge International 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 ANZ Group and Oakridge International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANZ Group Holdings and Oakridge International, you can compare the effects of market volatilities on ANZ Group and Oakridge International 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 ANZ Group with a short position of Oakridge International. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANZ Group and Oakridge International.
Diversification Opportunities for ANZ Group and Oakridge International
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ANZ and Oakridge is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding ANZ Group Holdings and Oakridge International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakridge International and ANZ Group 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 ANZ Group Holdings are associated (or correlated) with Oakridge International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakridge International has no effect on the direction of ANZ Group i.e., ANZ Group and Oakridge International go up and down completely randomly.
Pair Corralation between ANZ Group and Oakridge International
Assuming the 90 days trading horizon ANZ Group Holdings is expected to under-perform the Oakridge International. But the stock apears to be less risky and, when comparing its historical volatility, ANZ Group Holdings is 18.1 times less risky than Oakridge International. The stock trades about -0.13 of its potential returns per unit of risk. The Oakridge International is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 6.00 in Oakridge International on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Oakridge International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANZ Group Holdings vs. Oakridge International
Performance |
| Timeline |
| ANZ Group Holdings |
| Oakridge International |
ANZ Group and Oakridge International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANZ Group and Oakridge International
The main advantage of trading using opposite ANZ Group and Oakridge International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANZ Group position performs unexpectedly, Oakridge International 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 Oakridge International will offset losses from the drop in Oakridge International's long position.| ANZ Group vs. Duxton Broadacre Farms | ANZ Group vs. Iron Road | ANZ Group vs. Singular Health Group | ANZ Group vs. Austco Healthcare |
| Oakridge International vs. BKI Investment | Oakridge International vs. Bank of Queensland | Oakridge International vs. Perpetual Credit Income | Oakridge International vs. Magellan Financial Group |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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