Correlation Between Oceania Healthcare and OOhMedia
Can any of the company-specific risk be diversified away by investing in both Oceania Healthcare and OOhMedia 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 Oceania Healthcare and OOhMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oceania Healthcare and oOhMedia, you can compare the effects of market volatilities on Oceania Healthcare and OOhMedia 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 Oceania Healthcare with a short position of OOhMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oceania Healthcare and OOhMedia.
Diversification Opportunities for Oceania Healthcare and OOhMedia
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Oceania and OOhMedia is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Oceania Healthcare and oOhMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on oOhMedia and Oceania Healthcare 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 Oceania Healthcare are associated (or correlated) with OOhMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of oOhMedia has no effect on the direction of Oceania Healthcare i.e., Oceania Healthcare and OOhMedia go up and down completely randomly.
Pair Corralation between Oceania Healthcare and OOhMedia
Assuming the 90 days trading horizon Oceania Healthcare is expected to generate 1.26 times more return on investment than OOhMedia. However, Oceania Healthcare is 1.26 times more volatile than oOhMedia. It trades about 0.37 of its potential returns per unit of risk. oOhMedia is currently generating about -0.03 per unit of risk. If you would invest 60.00 in Oceania Healthcare on November 5, 2024 and sell it today you would earn a total of 13.00 from holding Oceania Healthcare or generate 21.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oceania Healthcare vs. oOhMedia
Performance |
| Timeline |
| Oceania Healthcare |
| oOhMedia |
Oceania Healthcare and OOhMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oceania Healthcare and OOhMedia
The main advantage of trading using opposite Oceania Healthcare and OOhMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oceania Healthcare position performs unexpectedly, OOhMedia 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 OOhMedia will offset losses from the drop in OOhMedia's long position.| Oceania Healthcare vs. Hutchison Telecommunications | Oceania Healthcare vs. Viva Leisure | Oceania Healthcare vs. Charter Hall Retail | Oceania Healthcare vs. Beam Communications Holdings |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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