Correlation Between Oberweis Small and Hodges Fund
Can any of the company-specific risk be diversified away by investing in both Oberweis Small and Hodges 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 Oberweis Small and Hodges Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oberweis Small Cap Opportunities and Hodges Fund Retail, you can compare the effects of market volatilities on Oberweis Small and Hodges 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 Oberweis Small with a short position of Hodges Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oberweis Small and Hodges Fund.
Diversification Opportunities for Oberweis Small and Hodges Fund
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oberweis and Hodges is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Oberweis Small Cap Opportuniti and Hodges Fund Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hodges Fund Retail and Oberweis Small 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 Oberweis Small Cap Opportunities are associated (or correlated) with Hodges Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hodges Fund Retail has no effect on the direction of Oberweis Small i.e., Oberweis Small and Hodges Fund go up and down completely randomly.
Pair Corralation between Oberweis Small and Hodges Fund
Assuming the 90 days horizon Oberweis Small is expected to generate 1.74 times less return on investment than Hodges Fund. But when comparing it to its historical volatility, Oberweis Small Cap Opportunities is 1.22 times less risky than Hodges Fund. It trades about 0.06 of its potential returns per unit of risk. Hodges Fund Retail is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 5,159 in Hodges Fund Retail on August 31, 2024 and sell it today you would earn a total of 2,785 from holding Hodges Fund Retail or generate 53.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Oberweis Small Cap Opportuniti vs. Hodges Fund Retail
Performance |
| Timeline |
| Oberweis Small Cap |
| Hodges Fund Retail |
Oberweis Small and Hodges Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oberweis Small and Hodges Fund
The main advantage of trading using opposite Oberweis Small and Hodges Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oberweis Small position performs unexpectedly, Hodges 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 Hodges Fund will offset losses from the drop in Hodges Fund's long position.| Oberweis Small vs. Oberweis Micro Cap Fund | Oberweis Small vs. Oberweis Emerging Growth | Oberweis Small vs. Oberweis International Opportunities | Oberweis Small vs. Needham Aggressive Growth |
| Hodges Fund vs. Marsico 21st Century | Hodges Fund vs. Kinetics Paradigm Fund | Hodges Fund vs. Royce Smaller Companies Growth | Hodges Fund vs. Polaris Global Value |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |