Correlation Between Oakley Capital and Ameren Corp
Can any of the company-specific risk be diversified away by investing in both Oakley Capital and Ameren Corp 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 Oakley Capital and Ameren Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oakley Capital Investments and Ameren Corp, you can compare the effects of market volatilities on Oakley Capital and Ameren Corp 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 Oakley Capital with a short position of Ameren Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oakley Capital and Ameren Corp.
Diversification Opportunities for Oakley Capital and Ameren Corp
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oakley and Ameren is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Oakley Capital Investments and Ameren Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameren Corp and Oakley Capital 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 Oakley Capital Investments are associated (or correlated) with Ameren Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameren Corp has no effect on the direction of Oakley Capital i.e., Oakley Capital and Ameren Corp go up and down completely randomly.
Pair Corralation between Oakley Capital and Ameren Corp
Assuming the 90 days trading horizon Oakley Capital Investments is expected to generate 1.48 times more return on investment than Ameren Corp. However, Oakley Capital is 1.48 times more volatile than Ameren Corp. It trades about 0.08 of its potential returns per unit of risk. Ameren Corp is currently generating about -0.08 per unit of risk. If you would invest 49,200 in Oakley Capital Investments on October 8, 2024 and sell it today you would earn a total of 1,000.00 from holding Oakley Capital Investments or generate 2.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oakley Capital Investments vs. Ameren Corp
Performance |
| Timeline |
| Oakley Capital Inves |
| Ameren Corp |
Oakley Capital and Ameren Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oakley Capital and Ameren Corp
The main advantage of trading using opposite Oakley Capital and Ameren Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oakley Capital position performs unexpectedly, Ameren Corp 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 Ameren Corp will offset losses from the drop in Ameren Corp's long position.| Oakley Capital vs. Verizon Communications | Oakley Capital vs. EVS Broadcast Equipment | Oakley Capital vs. Fortune Brands Home | Oakley Capital vs. bet at home AG |
| Ameren Corp vs. Capital Metals PLC | Ameren Corp vs. GreenX Metals | Ameren Corp vs. Thor Mining PLC | Ameren Corp vs. Wheaton Precious Metals |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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