Correlation Between Oakmark Select and Oakmark Global
Can any of the company-specific risk be diversified away by investing in both Oakmark Select and Oakmark Global 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 Select and Oakmark Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oakmark Select Fund and Oakmark Global, you can compare the effects of market volatilities on Oakmark Select and Oakmark Global 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 Select with a short position of Oakmark Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oakmark Select and Oakmark Global.
Diversification Opportunities for Oakmark Select and Oakmark Global
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between OAKMARK and Oakmark is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Oakmark Select Fund and Oakmark Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark Global and Oakmark Select 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 Select Fund are associated (or correlated) with Oakmark Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark Global has no effect on the direction of Oakmark Select i.e., Oakmark Select and Oakmark Global go up and down completely randomly.
Pair Corralation between Oakmark Select and Oakmark Global
Assuming the 90 days horizon Oakmark Select Fund is expected to generate 1.13 times more return on investment than Oakmark Global. However, Oakmark Select is 1.13 times more volatile than Oakmark Global. It trades about 0.1 of its potential returns per unit of risk. Oakmark Global is currently generating about 0.04 per unit of risk. If you would invest 5,149 in Oakmark Select Fund on August 26, 2024 and sell it today you would earn a total of 3,263 from holding Oakmark Select Fund or generate 63.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oakmark Select Fund vs. Oakmark Global
Performance |
| Timeline |
| Oakmark Select |
| Oakmark Global |
Oakmark Select and Oakmark Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oakmark Select and Oakmark Global
The main advantage of trading using opposite Oakmark Select and Oakmark Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oakmark Select position performs unexpectedly, Oakmark Global 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 Global will offset losses from the drop in Oakmark Global's long position.| Oakmark Select vs. Oakmark Fund Investor | Oakmark Select vs. Oakmark International Fund | Oakmark Select vs. Oakmark Global Fund | Oakmark Select vs. Oakmark Equity And |
| Oakmark Global vs. Oakmark Equity And | Oakmark Global vs. Oakmark International Small | Oakmark Global vs. Oakmark Select Fund | Oakmark Global vs. Oakmark International 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| 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 | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Stocks Directory Find actively traded stocks across global markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |