Correlation Between Live Oak and American Beacon
Can any of the company-specific risk be diversified away by investing in both Live Oak and American Beacon 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 American Beacon 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 American Beacon Stephens, you can compare the effects of market volatilities on Live Oak and American Beacon 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 American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Oak and American Beacon.
Diversification Opportunities for Live Oak and American Beacon
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LIVE and American is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Live Oak Health and American Beacon Stephens in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Stephens 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 American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Stephens has no effect on the direction of Live Oak i.e., Live Oak and American Beacon go up and down completely randomly.
Pair Corralation between Live Oak and American Beacon
Assuming the 90 days horizon Live Oak is expected to generate 20.86 times less return on investment than American Beacon. But when comparing it to its historical volatility, Live Oak Health is 1.3 times less risky than American Beacon. It trades about 0.0 of its potential returns per unit of risk. American Beacon Stephens is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,994 in American Beacon Stephens on August 26, 2024 and sell it today you would earn a total of 1,210 from holding American Beacon Stephens or generate 40.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Oak Health vs. American Beacon Stephens
Performance |
| Timeline |
| Live Oak Health |
| American Beacon Stephens |
Live Oak and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Oak and American Beacon
The main advantage of trading using opposite Live Oak and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Oak position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon'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 |
| American Beacon vs. Health Biotchnology Portfolio | American Beacon vs. Live Oak Health | American Beacon vs. Allianzgi Health Sciences | American Beacon vs. Blackrock Health Sciences |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |