Correlation Between Live Oak and Allianzgi Health
Can any of the company-specific risk be diversified away by investing in both Live Oak and Allianzgi Health 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 Allianzgi Health 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 Allianzgi Health Sciences, you can compare the effects of market volatilities on Live Oak and Allianzgi Health 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 Allianzgi Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Oak and Allianzgi Health.
Diversification Opportunities for Live Oak and Allianzgi Health
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Live and Allianzgi is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Live Oak Health and Allianzgi Health Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Health Sciences 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 Allianzgi Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Health Sciences has no effect on the direction of Live Oak i.e., Live Oak and Allianzgi Health go up and down completely randomly.
Pair Corralation between Live Oak and Allianzgi Health
Assuming the 90 days horizon Live Oak is expected to generate 8.67 times less return on investment than Allianzgi Health. In addition to that, Live Oak is 1.12 times more volatile than Allianzgi Health Sciences. It trades about 0.02 of its total potential returns per unit of risk. Allianzgi Health Sciences is currently generating about 0.15 per unit of volatility. If you would invest 2,792 in Allianzgi Health Sciences on October 23, 2024 and sell it today you would earn a total of 68.00 from holding Allianzgi Health Sciences or generate 2.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.74% |
| Values | Daily Returns |
Live Oak Health vs. Allianzgi Health Sciences
Performance |
| Timeline |
| Live Oak Health |
| Allianzgi Health Sciences |
Live Oak and Allianzgi Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Oak and Allianzgi Health
The main advantage of trading using opposite Live Oak and Allianzgi Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Oak position performs unexpectedly, Allianzgi Health 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 Allianzgi Health will offset losses from the drop in Allianzgi Health'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 |
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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