Correlation Between Oberweis Small-cap and Oberweis Emerging
Can any of the company-specific risk be diversified away by investing in both Oberweis Small-cap and Oberweis Emerging 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-cap and Oberweis Emerging 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 Oberweis Emerging Markets, you can compare the effects of market volatilities on Oberweis Small-cap and Oberweis Emerging 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-cap with a short position of Oberweis Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oberweis Small-cap and Oberweis Emerging.
Diversification Opportunities for Oberweis Small-cap and Oberweis Emerging
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oberweis and Oberweis is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Oberweis Small Cap Opportuniti and Oberweis Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oberweis Emerging Markets and Oberweis Small-cap 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 Oberweis Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oberweis Emerging Markets has no effect on the direction of Oberweis Small-cap i.e., Oberweis Small-cap and Oberweis Emerging go up and down completely randomly.
Pair Corralation between Oberweis Small-cap and Oberweis Emerging
Assuming the 90 days horizon Oberweis Small Cap Opportunities is expected to generate 62.13 times more return on investment than Oberweis Emerging. However, Oberweis Small-cap is 62.13 times more volatile than Oberweis Emerging Markets. It trades about 0.1 of its potential returns per unit of risk. Oberweis Emerging Markets is currently generating about -0.24 per unit of risk. If you would invest 2,625 in Oberweis Small Cap Opportunities on August 30, 2024 and sell it today you would earn a total of 82.00 from holding Oberweis Small Cap Opportunities or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 77.27% |
| Values | Daily Returns |
Oberweis Small Cap Opportuniti vs. Oberweis Emerging Markets
Performance |
| Timeline |
| Oberweis Small Cap |
| Oberweis Emerging Markets |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Oberweis Small-cap and Oberweis Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oberweis Small-cap and Oberweis Emerging
The main advantage of trading using opposite Oberweis Small-cap and Oberweis Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oberweis Small-cap position performs unexpectedly, Oberweis Emerging 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 Oberweis Emerging will offset losses from the drop in Oberweis Emerging's long position.| Oberweis Small-cap vs. T Rowe Price | Oberweis Small-cap vs. T Rowe Price | Oberweis Small-cap vs. Fidelity Small Cap | Oberweis Small-cap vs. Virtus Kar Small Cap |
| Oberweis Emerging vs. Oberweis Micro Cap Fund | Oberweis Emerging vs. Wasatch Emerging India | Oberweis Emerging vs. Driehaus Emerging Markets | Oberweis Emerging vs. Wasatch Emerging Markets |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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