Correlation Between F5 Networks and Oracle
Can any of the company-specific risk be diversified away by investing in both F5 Networks and Oracle 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 F5 Networks and Oracle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between F5 Networks and Oracle, you can compare the effects of market volatilities on F5 Networks and Oracle 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 F5 Networks with a short position of Oracle. Check out your portfolio center. Please also check ongoing floating volatility patterns of F5 Networks and Oracle.
Diversification Opportunities for F5 Networks and Oracle
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between FFIV and Oracle is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding F5 Networks and Oracle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oracle and F5 Networks 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 F5 Networks are associated (or correlated) with Oracle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oracle has no effect on the direction of F5 Networks i.e., F5 Networks and Oracle go up and down completely randomly.
Pair Corralation between F5 Networks and Oracle
If you would invest 328,180 in Oracle on November 8, 2024 and sell it today you would earn a total of 25,288 from holding Oracle or generate 7.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
F5 Networks vs. Oracle
Performance |
| Timeline |
| F5 Networks |
| Oracle |
F5 Networks and Oracle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with F5 Networks and Oracle
The main advantage of trading using opposite F5 Networks and Oracle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if F5 Networks position performs unexpectedly, Oracle 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 Oracle will offset losses from the drop in Oracle's long position.| F5 Networks vs. Micron Technology | F5 Networks vs. Air Transport Services | F5 Networks vs. Verizon Communications | F5 Networks vs. Grupo Sports World |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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