Correlation Between Brookfield Corp and XAI Octagon
Can any of the company-specific risk be diversified away by investing in both Brookfield Corp and XAI Octagon 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 Brookfield Corp and XAI Octagon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brookfield Corp and XAI Octagon Floating, you can compare the effects of market volatilities on Brookfield Corp and XAI Octagon 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 Brookfield Corp with a short position of XAI Octagon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookfield Corp and XAI Octagon.
Diversification Opportunities for Brookfield Corp and XAI Octagon
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Brookfield and XAI is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Corp and XAI Octagon Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XAI Octagon Floating and Brookfield Corp 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 Brookfield Corp are associated (or correlated) with XAI Octagon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XAI Octagon Floating has no effect on the direction of Brookfield Corp i.e., Brookfield Corp and XAI Octagon go up and down completely randomly.
Pair Corralation between Brookfield Corp and XAI Octagon
Allowing for the 90-day total investment horizon Brookfield Corp is expected to generate 4.52 times more return on investment than XAI Octagon. However, Brookfield Corp is 4.52 times more volatile than XAI Octagon Floating. It trades about 0.26 of its potential returns per unit of risk. XAI Octagon Floating is currently generating about 0.3 per unit of risk. If you would invest 5,468 in Brookfield Corp on August 28, 2024 and sell it today you would earn a total of 502.00 from holding Brookfield Corp or generate 9.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brookfield Corp vs. XAI Octagon Floating
Performance |
| Timeline |
| Brookfield Corp |
| XAI Octagon Floating |
Brookfield Corp and XAI Octagon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brookfield Corp and XAI Octagon
The main advantage of trading using opposite Brookfield Corp and XAI Octagon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brookfield Corp position performs unexpectedly, XAI Octagon 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 XAI Octagon will offset losses from the drop in XAI Octagon's long position.| Brookfield Corp vs. KKR Co LP | Brookfield Corp vs. Blackstone Group | Brookfield Corp vs. T Rowe Price | Brookfield Corp vs. Apollo Global Management |
| XAI Octagon vs. Oxford Lane Capital | XAI Octagon vs. Capital Southwest | XAI Octagon vs. Cornerstone Strategic Return | XAI Octagon vs. Cornerstone Strategic Value |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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