Correlation Between Oakmark International and Oakmark Fund
Can any of the company-specific risk be diversified away by investing in both Oakmark International and Oakmark Fund 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 Oakmark International and Oakmark Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oakmark International Small and Oakmark Fund Investor, you can compare the effects of market volatilities on Oakmark International and Oakmark Fund 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 Oakmark International with a short position of Oakmark Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oakmark International and Oakmark Fund.
Diversification Opportunities for Oakmark International and Oakmark Fund
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oakmark and Oakmark is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Oakmark International Small and Oakmark Fund Investor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark Fund Investor and Oakmark International 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 Oakmark International Small are associated (or correlated) with Oakmark Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark Fund Investor has no effect on the direction of Oakmark International i.e., Oakmark International and Oakmark Fund go up and down completely randomly.
Pair Corralation between Oakmark International and Oakmark Fund
Assuming the 90 days horizon Oakmark International Small is expected to under-perform the Oakmark Fund. But the mutual fund apears to be less risky and, when comparing its historical volatility, Oakmark International Small is 1.47 times less risky than Oakmark Fund. The mutual fund trades about -0.4 of its potential returns per unit of risk. The Oakmark Fund Investor is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 15,263 in Oakmark Fund Investor on August 25, 2024 and sell it today you would earn a total of 732.00 from holding Oakmark Fund Investor or generate 4.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oakmark International Small vs. Oakmark Fund Investor
Performance |
| Timeline |
| Oakmark International |
| Oakmark Fund Investor |
Oakmark International and Oakmark Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oakmark International and Oakmark Fund
The main advantage of trading using opposite Oakmark International and Oakmark Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oakmark International position performs unexpectedly, Oakmark Fund 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 Oakmark Fund will offset losses from the drop in Oakmark Fund's long position.| Oakmark International vs. Oakmark International Fund | Oakmark International vs. Oakmark Global Fund | Oakmark International vs. Oakmark Select Fund | Oakmark International vs. Oakmark Global Select |
| Oakmark Fund vs. Oakmark Select Fund | Oakmark Fund vs. Oakmark International Fund | Oakmark Fund vs. Oakmark Equity And | Oakmark Fund vs. Oakmark Global Fund |
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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