Correlation Between Ford and Oppenheimer Gbl
Can any of the company-specific risk be diversified away by investing in both Ford and Oppenheimer Gbl 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 Ford and Oppenheimer Gbl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Oppenheimer Gbl Alloc, you can compare the effects of market volatilities on Ford and Oppenheimer Gbl 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 Ford with a short position of Oppenheimer Gbl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Oppenheimer Gbl.
Diversification Opportunities for Ford and Oppenheimer Gbl
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ford and Oppenheimer is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Oppenheimer Gbl Alloc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Gbl Alloc and Ford 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 Ford Motor are associated (or correlated) with Oppenheimer Gbl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Gbl Alloc has no effect on the direction of Ford i.e., Ford and Oppenheimer Gbl go up and down completely randomly.
Pair Corralation between Ford and Oppenheimer Gbl
Taking into account the 90-day investment horizon Ford Motor is expected to under-perform the Oppenheimer Gbl. In addition to that, Ford is 4.65 times more volatile than Oppenheimer Gbl Alloc. It trades about -0.09 of its total potential returns per unit of risk. Oppenheimer Gbl Alloc is currently generating about 0.26 per unit of volatility. If you would invest 1,868 in Oppenheimer Gbl Alloc on November 9, 2024 and sell it today you would earn a total of 52.00 from holding Oppenheimer Gbl Alloc or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ford Motor vs. Oppenheimer Gbl Alloc
Performance |
| Timeline |
| Ford Motor |
| Oppenheimer Gbl Alloc |
Ford and Oppenheimer Gbl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Oppenheimer Gbl
The main advantage of trading using opposite Ford and Oppenheimer Gbl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Oppenheimer Gbl 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 Gbl will offset losses from the drop in Oppenheimer Gbl's long position.The idea behind Ford Motor and Oppenheimer Gbl Alloc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Oppenheimer Gbl vs. Oppenheimer Cap Apprec | Oppenheimer Gbl vs. Oppenheimer Global Fd | Oppenheimer Gbl vs. Oppenheimer Main Strt | Oppenheimer Gbl vs. Oppenheimer Main Street |
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.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |