Correlation Between Hotchkis Wiley and Oakmark International
Can any of the company-specific risk be diversified away by investing in both Hotchkis Wiley 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 Hotchkis Wiley and Oakmark International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hotchkis Wiley International and Oakmark International Fund, you can compare the effects of market volatilities on Hotchkis Wiley 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 Hotchkis Wiley with a short position of Oakmark International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotchkis Wiley and Oakmark International.
Diversification Opportunities for Hotchkis Wiley and Oakmark International
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hotchkis and Oakmark is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Hotchkis Wiley International and Oakmark International Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark International and Hotchkis Wiley 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 Hotchkis Wiley International 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 Hotchkis Wiley i.e., Hotchkis Wiley and Oakmark International go up and down completely randomly.
Pair Corralation between Hotchkis Wiley and Oakmark International
Assuming the 90 days horizon Hotchkis Wiley International is expected to under-perform the Oakmark International. In addition to that, Hotchkis Wiley is 4.97 times more volatile than Oakmark International Fund. It trades about -0.2 of its total potential returns per unit of risk. Oakmark International Fund is currently generating about 0.09 per unit of volatility. If you would invest 2,610 in Oakmark International Fund on September 12, 2024 and sell it today you would earn a total of 48.00 from holding Oakmark International Fund or generate 1.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Hotchkis Wiley International vs. Oakmark International Fund
Performance |
| Timeline |
| Hotchkis Wiley Inter |
| Oakmark International |
Hotchkis Wiley and Oakmark International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hotchkis Wiley and Oakmark International
The main advantage of trading using opposite Hotchkis Wiley and Oakmark International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotchkis Wiley 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.| Hotchkis Wiley vs. Oakmark International Fund | Hotchkis Wiley vs. Oakmark Global Fund | Hotchkis Wiley vs. Oakmark Select Fund | Hotchkis Wiley vs. Oakmark Global Select |
| Oakmark International vs. Oakmark Fund Investor | Oakmark International vs. Oakmark Select Fund | Oakmark International vs. Oakmark International Small | Oakmark International vs. Oakmark Global Fund |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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