Correlation Between Live Oak and Delaware Healthcare
Can any of the company-specific risk be diversified away by investing in both Live Oak and Delaware Healthcare 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 Delaware Healthcare 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 Delaware Healthcare Fund, you can compare the effects of market volatilities on Live Oak and Delaware Healthcare 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 Delaware Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Oak and Delaware Healthcare.
Diversification Opportunities for Live Oak and Delaware Healthcare
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between LIVE and Delaware is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Live Oak Health and Delaware Healthcare Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delaware Healthcare 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 Delaware Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delaware Healthcare has no effect on the direction of Live Oak i.e., Live Oak and Delaware Healthcare go up and down completely randomly.
Pair Corralation between Live Oak and Delaware Healthcare
Assuming the 90 days horizon Live Oak Health is expected to generate 0.9 times more return on investment than Delaware Healthcare. However, Live Oak Health is 1.12 times less risky than Delaware Healthcare. It trades about 0.08 of its potential returns per unit of risk. Delaware Healthcare Fund is currently generating about -0.18 per unit of risk. If you would invest 2,166 in Live Oak Health on August 27, 2024 and sell it today you would earn a total of 32.00 from holding Live Oak Health or generate 1.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Oak Health vs. Delaware Healthcare Fund
Performance |
| Timeline |
| Live Oak Health |
| Delaware Healthcare |
Live Oak and Delaware Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Oak and Delaware Healthcare
The main advantage of trading using opposite Live Oak and Delaware Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Oak position performs unexpectedly, Delaware Healthcare 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 Delaware Healthcare will offset losses from the drop in Delaware Healthcare'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 |
| Delaware Healthcare vs. Optimum Small Mid Cap | Delaware Healthcare vs. Optimum Small Mid Cap | Delaware Healthcare vs. Ivy Apollo Multi Asset | Delaware Healthcare vs. Optimum Fixed Income |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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