Correlation Between Natixis Oakmark and Vaughan Nelson
Can any of the company-specific risk be diversified away by investing in both Natixis Oakmark and Vaughan Nelson 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 Natixis Oakmark and Vaughan Nelson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Natixis Oakmark and Vaughan Nelson Small, you can compare the effects of market volatilities on Natixis Oakmark and Vaughan Nelson 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 Natixis Oakmark with a short position of Vaughan Nelson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Natixis Oakmark and Vaughan Nelson.
Diversification Opportunities for Natixis Oakmark and Vaughan Nelson
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Natixis and Vaughan is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Natixis Oakmark and Vaughan Nelson Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vaughan Nelson Small and Natixis Oakmark 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 Natixis Oakmark are associated (or correlated) with Vaughan Nelson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vaughan Nelson Small has no effect on the direction of Natixis Oakmark i.e., Natixis Oakmark and Vaughan Nelson go up and down completely randomly.
Pair Corralation between Natixis Oakmark and Vaughan Nelson
Assuming the 90 days horizon Natixis Oakmark is expected to generate 0.75 times more return on investment than Vaughan Nelson. However, Natixis Oakmark is 1.33 times less risky than Vaughan Nelson. It trades about 0.1 of its potential returns per unit of risk. Vaughan Nelson Small is currently generating about 0.07 per unit of risk. If you would invest 2,671 in Natixis Oakmark on September 4, 2024 and sell it today you would earn a total of 934.00 from holding Natixis Oakmark or generate 34.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Natixis Oakmark vs. Vaughan Nelson Small
Performance |
| Timeline |
| Natixis Oakmark |
| Vaughan Nelson Small |
Natixis Oakmark and Vaughan Nelson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Natixis Oakmark and Vaughan Nelson
The main advantage of trading using opposite Natixis Oakmark and Vaughan Nelson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Natixis Oakmark position performs unexpectedly, Vaughan Nelson 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 Vaughan Nelson will offset losses from the drop in Vaughan Nelson's long position.| Natixis Oakmark vs. Virtus High Yield | Natixis Oakmark vs. Gmo High Yield | Natixis Oakmark vs. Artisan High Income | Natixis Oakmark vs. Prudential High Yield |
| Vaughan Nelson vs. Natixis Equity Opportunities | Vaughan Nelson vs. Natixis Oakmark Fund | Vaughan Nelson vs. Vaughan Nelson Small | Vaughan Nelson vs. Loomis Sayles Growth |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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