Correlation Between Edgewood Growth and Oppenheimer International
Can any of the company-specific risk be diversified away by investing in both Edgewood Growth and Oppenheimer 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 Edgewood Growth and Oppenheimer International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edgewood Growth Fund and Oppenheimer International Growth, you can compare the effects of market volatilities on Edgewood Growth and Oppenheimer 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 Edgewood Growth with a short position of Oppenheimer International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edgewood Growth and Oppenheimer International.
Diversification Opportunities for Edgewood Growth and Oppenheimer International
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Edgewood and Oppenheimer is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Edgewood Growth Fund and Oppenheimer International Grow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer International and Edgewood Growth 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 Edgewood Growth Fund are associated (or correlated) with Oppenheimer International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer International has no effect on the direction of Edgewood Growth i.e., Edgewood Growth and Oppenheimer International go up and down completely randomly.
Pair Corralation between Edgewood Growth and Oppenheimer International
Assuming the 90 days horizon Edgewood Growth Fund is expected to generate 1.03 times more return on investment than Oppenheimer International. However, Edgewood Growth is 1.03 times more volatile than Oppenheimer International Growth. It trades about 0.34 of its potential returns per unit of risk. Oppenheimer International Growth is currently generating about 0.06 per unit of risk. If you would invest 5,122 in Edgewood Growth Fund on September 4, 2024 and sell it today you would earn a total of 328.00 from holding Edgewood Growth Fund or generate 6.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Edgewood Growth Fund vs. Oppenheimer International Grow
Performance |
| Timeline |
| Edgewood Growth |
| Oppenheimer International |
Edgewood Growth and Oppenheimer International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edgewood Growth and Oppenheimer International
The main advantage of trading using opposite Edgewood Growth and Oppenheimer International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edgewood Growth position performs unexpectedly, Oppenheimer 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 Oppenheimer International will offset losses from the drop in Oppenheimer International's long position.| Edgewood Growth vs. John Hancock Disciplined | Edgewood Growth vs. Diamond Hill Large | Edgewood Growth vs. Hartford Schroders Emerging | Edgewood Growth vs. Oakmark International Fund |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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