Correlation Between Black Oak and Ab Minnesota
Can any of the company-specific risk be diversified away by investing in both Black Oak and Ab Minnesota 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 Black Oak and Ab Minnesota into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Black Oak Emerging and Ab Minnesota Portfolio, you can compare the effects of market volatilities on Black Oak and Ab Minnesota 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 Black Oak with a short position of Ab Minnesota. Check out your portfolio center. Please also check ongoing floating volatility patterns of Black Oak and Ab Minnesota.
Diversification Opportunities for Black Oak and Ab Minnesota
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Black and AMNAX is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Black Oak Emerging and Ab Minnesota Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Minnesota Portfolio and Black Oak 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 Black Oak Emerging are associated (or correlated) with Ab Minnesota. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Minnesota Portfolio has no effect on the direction of Black Oak i.e., Black Oak and Ab Minnesota go up and down completely randomly.
Pair Corralation between Black Oak and Ab Minnesota
Assuming the 90 days horizon Black Oak Emerging is expected to generate 5.69 times more return on investment than Ab Minnesota. However, Black Oak is 5.69 times more volatile than Ab Minnesota Portfolio. It trades about 0.09 of its potential returns per unit of risk. Ab Minnesota Portfolio is currently generating about 0.03 per unit of risk. If you would invest 765.00 in Black Oak Emerging on August 31, 2024 and sell it today you would earn a total of 50.00 from holding Black Oak Emerging or generate 6.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Black Oak Emerging vs. Ab Minnesota Portfolio
Performance |
| Timeline |
| Black Oak Emerging |
| Ab Minnesota Portfolio |
Black Oak and Ab Minnesota Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Black Oak and Ab Minnesota
The main advantage of trading using opposite Black Oak and Ab Minnesota positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Black Oak position performs unexpectedly, Ab Minnesota 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 Ab Minnesota will offset losses from the drop in Ab Minnesota's long position.| Black Oak vs. Red Oak Technology | Black Oak vs. Pin Oak Equity | Black Oak vs. White Oak Select | Black Oak vs. Live Oak Health |
| Ab Minnesota vs. Franklin Lifesmart Retirement | Ab Minnesota vs. Multimanager Lifestyle Moderate | Ab Minnesota vs. American Funds Retirement | Ab Minnesota vs. Calvert Moderate Allocation |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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