Correlation Between Live Oak and Cognios Market
Can any of the company-specific risk be diversified away by investing in both Live Oak and Cognios Market 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 Live Oak and Cognios Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Live Oak Health and Cognios Market Neutral, you can compare the effects of market volatilities on Live Oak and Cognios Market 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 Live Oak with a short position of Cognios Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Oak and Cognios Market.
Diversification Opportunities for Live Oak and Cognios Market
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Live and Cognios is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Live Oak Health and Cognios Market Neutral in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cognios Market Neutral and Live Oak 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 Live Oak Health are associated (or correlated) with Cognios Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cognios Market Neutral has no effect on the direction of Live Oak i.e., Live Oak and Cognios Market go up and down completely randomly.
Pair Corralation between Live Oak and Cognios Market
Assuming the 90 days horizon Live Oak Health is expected to generate 2.61 times more return on investment than Cognios Market. However, Live Oak is 2.61 times more volatile than Cognios Market Neutral. It trades about 0.37 of its potential returns per unit of risk. Cognios Market Neutral is currently generating about -0.05 per unit of risk. If you would invest 2,010 in Live Oak Health on November 3, 2024 and sell it today you would earn a total of 119.00 from holding Live Oak Health or generate 5.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 95.24% |
Values | Daily Returns |
Live Oak Health vs. Cognios Market Neutral
Performance |
Timeline |
Live Oak Health |
Cognios Market Neutral |
Live Oak and Cognios Market Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Live Oak and Cognios Market
The main advantage of trading using opposite Live Oak and Cognios Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Oak position performs unexpectedly, Cognios Market 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 Cognios Market will offset losses from the drop in Cognios Market's long position.Live Oak vs. Black Oak Emerging | Live Oak vs. Pin Oak Equity | Live Oak vs. Red Oak Technology | Live Oak vs. White Oak Select |
Cognios Market vs. Absolute Convertible Arbitrage | Cognios Market vs. Virtus Convertible | Cognios Market vs. Rationalpier 88 Convertible | Cognios Market vs. Putnam Convertible Securities |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Transaction History View history of all your transactions and understand their impact on performance | |
Global Correlations Find global opportunities by holding instruments from different markets |