Correlation Between Baillie Gifford and Oppenheimer Intl
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford 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 Baillie Gifford and Oppenheimer Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baillie Gifford Health and Oppenheimer Intl Small, you can compare the effects of market volatilities on Baillie Gifford 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 Baillie Gifford with a short position of Oppenheimer Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Oppenheimer Intl.
Diversification Opportunities for Baillie Gifford and Oppenheimer Intl
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Baillie and Oppenheimer is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Oppenheimer Intl Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Intl Small and Baillie Gifford 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 Baillie Gifford Health 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 Small has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Oppenheimer Intl go up and down completely randomly.
Pair Corralation between Baillie Gifford and Oppenheimer Intl
Assuming the 90 days horizon Baillie Gifford Health is expected to generate 1.93 times more return on investment than Oppenheimer Intl. However, Baillie Gifford is 1.93 times more volatile than Oppenheimer Intl Small. It trades about -0.05 of its potential returns per unit of risk. Oppenheimer Intl Small is currently generating about -0.1 per unit of risk. If you would invest 591.00 in Baillie Gifford Health on August 31, 2024 and sell it today you would lose (11.00) from holding Baillie Gifford Health or give up 1.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Health vs. Oppenheimer Intl Small
Performance |
| Timeline |
| Baillie Gifford Health |
| Oppenheimer Intl Small |
Baillie Gifford and Oppenheimer Intl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Oppenheimer Intl
The main advantage of trading using opposite Baillie Gifford and Oppenheimer Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford 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.| Baillie Gifford vs. Vy T Rowe | Baillie Gifford vs. Eaton Vance Atlanta | Baillie Gifford vs. Blackrock Health Sciences | Baillie Gifford vs. Blackrock Health Sciences |
| Oppenheimer Intl vs. Baillie Gifford Health | Oppenheimer Intl vs. Blackrock Health Sciences | Oppenheimer Intl vs. The Gabelli Healthcare | Oppenheimer Intl vs. Fidelity Advisor Health |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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