Correlation Between GM and Oppenheimer Steelpath
Can any of the company-specific risk be diversified away by investing in both GM and Oppenheimer Steelpath 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 GM and Oppenheimer Steelpath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Oppenheimer Steelpath Mlp, you can compare the effects of market volatilities on GM and Oppenheimer Steelpath 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 GM with a short position of Oppenheimer Steelpath. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Oppenheimer Steelpath.
Diversification Opportunities for GM and Oppenheimer Steelpath
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GM and Oppenheimer is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Oppenheimer Steelpath Mlp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Steelpath Mlp and GM 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 General Motors are associated (or correlated) with Oppenheimer Steelpath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Steelpath Mlp has no effect on the direction of GM i.e., GM and Oppenheimer Steelpath go up and down completely randomly.
Pair Corralation between GM and Oppenheimer Steelpath
Allowing for the 90-day total investment horizon GM is expected to generate 2.63 times less return on investment than Oppenheimer Steelpath. In addition to that, GM is 2.96 times more volatile than Oppenheimer Steelpath Mlp. It trades about 0.07 of its total potential returns per unit of risk. Oppenheimer Steelpath Mlp is currently generating about 0.58 per unit of volatility. If you would invest 856.00 in Oppenheimer Steelpath Mlp on August 29, 2024 and sell it today you would earn a total of 112.00 from holding Oppenheimer Steelpath Mlp or generate 13.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Oppenheimer Steelpath Mlp
Performance |
| Timeline |
| General Motors |
| Oppenheimer Steelpath Mlp |
GM and Oppenheimer Steelpath Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Oppenheimer Steelpath
The main advantage of trading using opposite GM and Oppenheimer Steelpath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Oppenheimer Steelpath 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 Steelpath will offset losses from the drop in Oppenheimer Steelpath's long position.The idea behind General Motors and Oppenheimer Steelpath Mlp 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 Steelpath vs. Oppenheimer Main Street | Oppenheimer Steelpath vs. Oppenheimer Intl Small | Oppenheimer Steelpath vs. Oppenheimer Main Street | Oppenheimer Steelpath vs. Oppenheimer Global Strtgc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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