Correlation Between Oakmark Fund and Salient Tactical
Can any of the company-specific risk be diversified away by investing in both Oakmark Fund and Salient Tactical 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 Fund and Salient Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oakmark Fund R6 and Salient Tactical Growth, you can compare the effects of market volatilities on Oakmark Fund and Salient Tactical 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 Fund with a short position of Salient Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oakmark Fund and Salient Tactical.
Diversification Opportunities for Oakmark Fund and Salient Tactical
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Oakmark and Salient is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Oakmark Fund R6 and Salient Tactical Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salient Tactical Growth and Oakmark Fund 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 Fund R6 are associated (or correlated) with Salient Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salient Tactical Growth has no effect on the direction of Oakmark Fund i.e., Oakmark Fund and Salient Tactical go up and down completely randomly.
Pair Corralation between Oakmark Fund and Salient Tactical
Assuming the 90 days horizon Oakmark Fund R6 is expected to generate 2.35 times more return on investment than Salient Tactical. However, Oakmark Fund is 2.35 times more volatile than Salient Tactical Growth. It trades about 0.34 of its potential returns per unit of risk. Salient Tactical Growth is currently generating about 0.25 per unit of risk. If you would invest 15,180 in Oakmark Fund R6 on November 3, 2024 and sell it today you would earn a total of 814.00 from holding Oakmark Fund R6 or generate 5.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oakmark Fund R6 vs. Salient Tactical Growth
Performance |
| Timeline |
| Oakmark Fund R6 |
| Salient Tactical Growth |
Oakmark Fund and Salient Tactical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oakmark Fund and Salient Tactical
The main advantage of trading using opposite Oakmark Fund and Salient Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oakmark Fund position performs unexpectedly, Salient Tactical 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 Salient Tactical will offset losses from the drop in Salient Tactical's long position.| Oakmark Fund vs. Six Circles Credit | Oakmark Fund vs. Tiaa Cref High Yield | Oakmark Fund vs. Dunham High Yield | Oakmark Fund vs. Jpmorgan High Yield |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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