Correlation Between Gmo Global and Oppenheimer Gold
Can any of the company-specific risk be diversified away by investing in both Gmo Global and Oppenheimer Gold 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 Gmo Global and Oppenheimer Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gmo Global Equity and Oppenheimer Gold Special, you can compare the effects of market volatilities on Gmo Global and Oppenheimer Gold 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 Gmo Global with a short position of Oppenheimer Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gmo Global and Oppenheimer Gold.
Diversification Opportunities for Gmo Global and Oppenheimer Gold
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gmo and Oppenheimer is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Gmo Global Equity and Oppenheimer Gold Special in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Gold Special and Gmo Global 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 Gmo Global Equity are associated (or correlated) with Oppenheimer Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Gold Special has no effect on the direction of Gmo Global i.e., Gmo Global and Oppenheimer Gold go up and down completely randomly.
Pair Corralation between Gmo Global and Oppenheimer Gold
Assuming the 90 days horizon Gmo Global is expected to generate 4.95 times less return on investment than Oppenheimer Gold. But when comparing it to its historical volatility, Gmo Global Equity is 2.66 times less risky than Oppenheimer Gold. It trades about 0.04 of its potential returns per unit of risk. Oppenheimer Gold Special is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,337 in Oppenheimer Gold Special on September 3, 2024 and sell it today you would earn a total of 177.00 from holding Oppenheimer Gold Special or generate 7.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gmo Global Equity vs. Oppenheimer Gold Special
Performance |
| Timeline |
| Gmo Global Equity |
| Oppenheimer Gold Special |
Gmo Global and Oppenheimer Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gmo Global and Oppenheimer Gold
The main advantage of trading using opposite Gmo Global and Oppenheimer Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gmo Global position performs unexpectedly, Oppenheimer Gold 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 Gold will offset losses from the drop in Oppenheimer Gold's long position.| Gmo Global vs. Oppenheimer Gold Special | Gmo Global vs. Gamco Global Gold | Gmo Global vs. First Eagle Gold | Gmo Global vs. Franklin Gold Precious |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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