Correlation Between Fzsvmx and Oakmark International

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Can any of the company-specific risk be diversified away by investing in both Fzsvmx and Oakmark 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 Fzsvmx and Oakmark International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fzsvmx and Oakmark International Small, you can compare the effects of market volatilities on Fzsvmx and Oakmark 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 Fzsvmx with a short position of Oakmark International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fzsvmx and Oakmark International.

Diversification Opportunities for Fzsvmx and Oakmark International

FzsvmxOakmarkDiversified AwayFzsvmxOakmarkDiversified Away100%
-0.02
  Correlation Coefficient

Good diversification

The 3 months correlation between Fzsvmx and Oakmark is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Fzsvmx and Oakmark International Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark International and Fzsvmx 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 Fzsvmx are associated (or correlated) with Oakmark International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark International has no effect on the direction of Fzsvmx i.e., Fzsvmx and Oakmark International go up and down completely randomly.

Pair Corralation between Fzsvmx and Oakmark International

Assuming the 90 days trading horizon Fzsvmx is expected to generate 0.67 times more return on investment than Oakmark International. However, Fzsvmx is 1.5 times less risky than Oakmark International. It trades about 0.12 of its potential returns per unit of risk. Oakmark International Small is currently generating about 0.01 per unit of risk. If you would invest  1,069  in Fzsvmx on November 21, 2024 and sell it today you would earn a total of  11.00  from holding Fzsvmx or generate 1.03% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy6.19%
ValuesDaily Returns

Fzsvmx  vs.  Oakmark International Small

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -10-8-6-4-202
JavaScript chart by amCharts 3.21.15FZSVMX OAZEX
       Timeline  
Fzsvmx 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Over the last 90 days Fzsvmx has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Fzsvmx is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Oakmark International 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Oakmark International Small are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Oakmark International is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb17.51818.51919.5

Fzsvmx and Oakmark International Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.99-1.47-0.95-0.430.04460.541.061.582.12.62 0.20.40.60.8
JavaScript chart by amCharts 3.21.15FZSVMX OAZEX
       Returns  

Pair Trading with Fzsvmx and Oakmark International

The main advantage of trading using opposite Fzsvmx and Oakmark International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fzsvmx position performs unexpectedly, Oakmark 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 Oakmark International will offset losses from the drop in Oakmark International's long position.
The idea behind Fzsvmx and Oakmark International Small 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.
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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