Correlation Between Hennessy and Oppenheimer Main
Can any of the company-specific risk be diversified away by investing in both Hennessy and Oppenheimer Main 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 Hennessy and Oppenheimer Main into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hennessy Bp Energy and Oppenheimer Main Street, you can compare the effects of market volatilities on Hennessy and Oppenheimer Main 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 Hennessy with a short position of Oppenheimer Main. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hennessy and Oppenheimer Main.
Diversification Opportunities for Hennessy and Oppenheimer Main
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hennessy and Oppenheimer is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Hennessy Bp Energy and Oppenheimer Main Street in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Main Street and Hennessy 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 Hennessy Bp Energy are associated (or correlated) with Oppenheimer Main. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Main Street has no effect on the direction of Hennessy i.e., Hennessy and Oppenheimer Main go up and down completely randomly.
Pair Corralation between Hennessy and Oppenheimer Main
Assuming the 90 days horizon Hennessy Bp Energy is expected to generate 0.83 times more return on investment than Oppenheimer Main. However, Hennessy Bp Energy is 1.21 times less risky than Oppenheimer Main. It trades about 0.4 of its potential returns per unit of risk. Oppenheimer Main Street is currently generating about 0.3 per unit of risk. If you would invest 2,607 in Hennessy Bp Energy on September 4, 2024 and sell it today you would earn a total of 265.00 from holding Hennessy Bp Energy or generate 10.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Hennessy Bp Energy vs. Oppenheimer Main Street
Performance |
| Timeline |
| Hennessy Bp Energy |
| Oppenheimer Main Street |
Hennessy and Oppenheimer Main Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hennessy and Oppenheimer Main
The main advantage of trading using opposite Hennessy and Oppenheimer Main positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hennessy position performs unexpectedly, Oppenheimer Main 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 Main will offset losses from the drop in Oppenheimer Main's long position.| Hennessy vs. World Energy Fund | Hennessy vs. Ivy Energy Fund | Hennessy vs. Blackrock All Cap Energy | Hennessy vs. Energy Fund Class |
| Oppenheimer Main vs. Oppenheimer Main Street | Oppenheimer Main vs. Oppenheimer Intl Small | Oppenheimer Main vs. Oppenheimer Global Strtgc | Oppenheimer Main vs. Oppenheimer Strat Incm |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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